Computer apparatus and method for illustrating, issuing, and managing disability coverage for retirement plans with individual accounts

ABSTRACT

A computer-aided method of computing coverage benefit costs for a retirement plan having respective accounts for individuals, the method including the steps of converting input plan contribution data for at least one of said accounts of said retirement plan into corresponding input digital electrical signals, manipulating the input digital electrical signals in computing the coverage benefit costs for the at least one of said accounts according to said retirement plan, and producing output at an output device. The output including the computed coverage benefit costs for the at least one of said accounts of said retirement plan. The method is suitable for IRS Sec. 401, 408, 457, in cases such as an IRA, ROTH IRA, individual social security accounts of whatever country may be at issue, and the like. Input plan contribution data can include data such as FICA tax, Federal Old Age, Survivors, and Disability Insurance tax data.

I. CLAIM OF PRIORITY

The present patent application is a continuation-in-part patentapplication, claims priority from, and incorporates by reference, U.S.patent application Ser. No. 09/861,752, filed May 21, 2001. Ser. No.09/861,752 is a continuation-in-part patent application, claimingpriority from, and incorporating by reference Ser. No. 08/936,037, filedSep. 23, 1997, titled “Computer Apparatus And method For DefinedContribution And Profit Sharing Pension And Disability Plan, naming asinventors Matthew B. Schoen and Jean-Paul Khodara, becoming U.S. Pat.No. 6,235,176 on May 22, 2001. The present patent application alsoincorporates by reference from as if fully restated herein U.S. Ser.Nos. 10/784,719, filed Feb. 23, 2004; and 11/861,084, filed Sep. 25,2007.

II. APPENDIX AND COPYRIGHT NOTICE

This patent application includes an appendix incorporated by referenceherein.

A portion of the disclosure of this patent document contains materialthat is subject to copyright protection. The copyright owner has noobjection to a statutory fair use of this material, as it appears in thefiles of the files or records of the U.S. Patent and Trademark Office,but otherwise reserves all copyright rights whatsoever.

III. FIELD OF THE INVENTION

The present invention is in the field of digital electrical apparatusand method for making and using the same, as well as data structures andnecessary intermediates created thereby. More particularly, the presentinvention is directed to technical effects of such invention in signalprocessing for administrating disability insurance or benefits coveringindividual participant contributions to individual retirement accountsand the earnings thereon that meet the requirements set forth, forexample, under the Internal Revenue Code Section 408, contributions toIndividual Social Security Retirement Accounts (as are beingcontemplated under possible future U.S. legislation, but are inoperation in other countries), and the like, as well as in handling theearnings thereon, and for administrating disability insurance coveringemployee and/or employer contributions to defined contribution qualifiedand non-qualified pension plans and profit sharing plans.

IV. BACKGROUND OF THE INVENTION

Until the early 1980s, the dominant form of retirement income planssponsored by corporations for their employees within the United Stateswere defined benefit plans. Under defined benefit plans (DB plans), theemployee's retirement benefits are amounts guaranteed to the departingemployee and are insured by the PBGC. The employer's ongoingcontribution to the plan is determined actuarially. Since 1974 and theenactment of ERISA, there have been at least fifteen legislative actsimpacting qualified pension and profit sharing plans. Much of thislegislation has made defined benefit plans less and less attractive foremployers to sponsor and have made defined contribution plans more andmore attractive. By far the most popular type of non-defined benefitqualified retirement plan to emerge during the past fifteen years is the401(k) plan. These plans can be structured several ways and canoptionally be either a profit sharing plan or an ESOP (employer stockownership plan) plan. They allow employees to contribute an allowablepercentage of pretax income into the plan, making them a very attractivelong-term savings vehicle for retirement. Further enhancing the appealof 401(k) plans for employees, is the ability for employers to make anoptional matching contribution. Most 401(k) plans provide an employermatching contribution of some kind and allow employees to be pro-activein selecting the investment direction of their accounts. Employers areparticularly pleased with the heightened awareness employees tend tohave about the value of the 401(k) benefit plan. Employees often payless attention to and appreciate less defined benefit plans—despite thefact that they may cost the employer more and prove more valuable to theemployee. In addition to the above, employers have become aware of thecostly nature of all employee benefits (i.e., due to the impact ofmedical inflation on medial benefits and the accounting rule changesimpacting retiree medical and life plans—FASB statement 106).Consequently, employers are becoming increasingly cost conscious aboutall benefit offerings.

One of the effects of the recent trends in employee benefits describedabove, is that there are currently over 30 million employeesparticipating in 401(k) plans—in 1974 there were none. Additionally,there has been an enormous increase in the number of highly compensatedemployees participating in non-qualified retirement plans due to benefitrestrictions in qualified plans.

A common feature in defined benefit pension plans is a disabilitycompletion benefit. If the plan participant becomes disabled prior toretirement, the employer is obligated to continue funding on theemployee's behalf until retirement. The employee is entitled toapproximately the same level of retirement income as they would havereceived absent the disability (small differences are possible sincesalary increases between the date of disability and retirement must beestimated). The point is under defined benefit plans there is anestablished practice of providing an undiminished level of retirementincome to employees who become disabled during active employment years.

In contrast, employers offering defined contribution pension and profitsharing plans have not historically provided an undiminished retirementbenefit in the event of disability. Because of the recent shift from apre-dominate reliance on defined benefit plans to more and more relianceupon defined contribution plans, millions of American employees are atrisk of losing a significant portion of their retirement benefits in theevent of disability (spouses and dependents are also at risk).

There are many ways to protect employees from this risk. For example,employers may be able to continue making contributions on behalf of adisabled employee. However, there are several legal hurdles that makethis difficult to accomplish. IRC Code Section 415(c)(3)(c) includes adefinition of disability that prevents employers from providing adequatebenefits for the majority of disabled employees. If the employer doesprovide a disability benefit, they can either self insure the risk orinsure it.

There are many different ways that insurance can be structured to coverthe risk of losing defined contribution plan retirement benefits. Forexample: (1) the employer can pay for coverage either within the definedcontribution plan or outside of it; (2) the employee can voluntarilypurchase coverage either within the defined contribution plan or outsideof it; or (3) the employer and employee can share the expense forcoverage either within the defined contribution plan or outside of it.

In addition, the policy of coverage can be provided under either a groupor individual contract. Coverage can provide either immediate benefitpayments (payments made at the time of disability), or deferred benefitpayments. If immediate, the benefit payments can be made internal orexternal to the defined contribution plan in a number of ways. In thefinal analysis such coverage will be structured according to theparticular needs and desires of each sponsoring employer and thespecific (legal and other) requirements of their existing benefit plans.

Given that this represents a huge existing marketplace for insurancecompanies in the disability insurance market, it is interesting to notethat none have successfully entered it on a significant scale. There areno serious underwriting risks blocking entry into the market. Theconcern for “over-insuring” is easily offset by restrictions on thedisabled person's ability to access funds prior to retirement. Somecarriers have, on a very limited basis, provided coverage to highlycompensated employees external to defined contribution plans. Whilecoverage is underwritten with the intent to protect defined contributionplan retirement benefits, the policies used thus far have been policyforms that were originally designed and priced to cover other loss ofincome risks.

To date, disability policies have not been made available to the entireemployee population of a defined contribution plan—either within thedefined contribution plan or external to the plan. To date, disabilitypolicies have not been made available to participants (either to allplan participants or even a sub-grouping of plan participants) within adefined contribution plan.

Historically, disability policies offered to protect participantcontributions (employer and or employee paid) to defined contributionplans, have been made available only on a very limited basis (i.e.,never offered to more than ⅓ of a plan's participants). Additionally,they have only been offered external to the defined contribution plan.Less than 100 of these limited, external employer sponsored plans havebeen underwritten during the past five years. Only two or three carriershave been willing to offer polices to defined contribution participants.This coverage has been offered on a guaranteed issue basis. Othercarriers are not prepared to offer individual policies on a guaranteedissue basis.

One major insurance carrier, a leader in offering administrativeservices for 401(k) plans, attempted to make a disability policyavailable to 401(k) plan participants. They were forced to withdraw theproduct from the market shortly after introduction. Their outside legalcounsel discovered that the way they structured the policy offeringwithin the 401(k) plan caused the 401(k) plan to be in violation ofERISA rules—thus subjecting the sponsoring employer to potential finesor plan disqualification.

Another leading disability carrier attempted to market a rider to theirexisting group long term disability (LTD) plans. The rider would bepurchased voluntarily by persons covered under the employer sponsoredLTD plan who were also participants of a 401(k) plan. The rider wasdesigned to protect 401(k) contributions. Thus far, interest in offeringthe rider to employees has been minimal. In the few situations whereemployers have consented to allow the carrier to offer the rider totheir employees, participation has been extremely low. The carrierconsiders the entire initiative a failure and is seeking other ways ofmaking coverage available so that participation reaches more successfullevels.

Most defined benefit plan disability protection offered by employers isself-insured. Annual plan contribution levels are determinedactuarially. The amount needed to fund for current and future disabledparticipants is included in the actuarial formulas. Therefore,disability insurers have not developed computer systems to cover allemployee participants of defined benefit pension plans.

In most of the established disability markets (both group andindividual) the policy is sold to the covered person directly or is soldto them indirectly through some form of sponsorship—an employer makescoverage available to employees or an association makes coverageavailable to members. Employers also provide coverage on anon-contributory basis to employees. In all of these situations, theinsurance carrier usually has to deal with only one, two, or threeparties at most:

1. The covered individual if coverage is sold to them directly;2. The covered individual and employer (or association) if coverage issold through employer (or association) sponsorship—whether contributoryor non-contributory; or3. The employer if coverage is provided on a non-contributory guaranteedissue basis.

In addition to the above, the insurance carrier may work with a trusteeof a welfare benefit trust established by the employer or association.Insurance companies may also use third party administrators to performsome or all of the administration associated with offering traditionaldisability coverage. Historically, the computer systems used to providedisability coverage and administer it on an ongoing basis has beenlimited by needs attendant to the scenarios described above.

Although several carriers have attempted expand from these traditionalmarkets into the defined contribution plan market by offering some formof protection to participants, thus far they have been largelyunsuccessful. There are over 30 million 401(k) plan participantsalone—less than 20 thousand have coverage protecting 401(k) retirementbenefits from disability (either employee paid or employer paid). Noneof these existing policies are provided within the 401(k) plans.

None of the carriers trying to enter into the disability coverage fordefined contribution plan market have figured out what is required tooffer coverage in the plan. None have figured out what it takes to offerdisability coverage to all participants of defined contributionplans—either in the plan or external to the plan. None have identifiedwhat is required to efficiently deal with a all of the additional lawspertaining to the ongoing tax law and labor law qualifications of eachtype of qualified defined contribution plan.

Because a full knowledge of the rules is required in order to assureongoing defined contribution plan compliance and qualification, nonehave been able to offer a disability product (either group orindividual) to employers or employees other than on a basis where therules can not be violated (i.e., outside of the plans to a small groupof participants).

Under Internal Revenue Code Section 408, certain individuals with earnedincome are eligible to make contributions to various individualretirement accounts and individual retirement annuities. Eligibilityrules differ depending upon the type of individual retirement account.For example, generally, anyone under the age of 70½ who earns incomefrom employment may make contributions to a traditional individualretirement account (IRA). For a Roth IRA, contributions may be made aslong as the individual has earned income and a modified adjusted grossincome below certain thresholds.

Under current law each eligible person may contribute a maximum of$2,000 or 100% of compensation, whichever is less, to either atraditional or Roth IRA annually (or split the maximum between plans,e.g., $1,000 to each).

Contributions to traditional IRAs are fully tax-deductible for federalincome tax purposes if neither the individual nor their spouse is anactive participant in an employer-sponsored qualified retirement plan.The deduction is reduced or eliminated if the individual's modifiedadjusted gross income exceeds certain thresholds.

Roth IRA contributions are not deductible for federal income taxpurposes. However, withdrawals from Roth IRAs that begin after age 59½are tax-free provided the Roth IRA has been established for more thanfive years.

Traditional IRA distributions may start after age 59½ and must start nolater than age 70½. Withdrawals made prior to age 59½ are generallysubject to a 10% penalty tax in addition to income tax. Exceptions tothe penalty tax are made for certain distributions. Examples include butare not limited to the following:

-   -   Taken in substantially equal amounts over the individual's life        expectancy    -   Occur due to the disability of the owner of the IRA    -   Are used to pay medical expenses in excess of 7.5% of ADI

As noted above and clearly stipulated in Internal Revenue Code Section408, both traditional and Roth IRAs are primarily intended as retirementsavings accounts. Furthermore, traditional IRAs only provide favorablefederal income tax deductions to those individuals who are notparticipants in employer-sponsored qualified retirement plans.Deductions are limited or offset completely if current earned incomeexceeds certain thresholds.

Individuals who are relying upon IRAs as a primary source of retirementincome are generally the same people depending upon social security asanother prime source of retirement income. Stated differently, peoplewho work for employers sponsoring qualified retirement plan(s) are lessdependent upon social security or IRAs for retirement income than peoplewho work for employers offering no retirement plan(s). Even if thecurrent law is liberalized to provide tax savings or incentives toindividuals covered by private pension plans, there is a need to assurethat targeted savings at retirement are not compromised due tounforeseen circumstances such as disabilities.

Additionally, many employer-sponsored qualified retirement plans provideemployee participants certain safeguards with respect to the amount ofretirement benefits available at retirement. For example, definedbenefit pension plans are qualified retirement plans with employercontributions aggregated annually based upon an actuarially determinedplan liability. Current contributions are generally based upon estimatesof future employee income levels immediately prior to retirement (e.g.,50% of the final five years' average gross salary) and other actuarialfactors such as estimated rates of return on plan assets, liabilitydiscount rates, employee turnover, mortality and morbidity. In contrast,benefits under defined contribution plans and hybrid plans such as CashBalance plans are based upon individual accounts.

Sometimes defined benefit plans provide a disability protectionprovision. In the event the employee plan participant becomes disabledprior to retirement, the plan continues to accrue benefits as though theemployee continued active employment. Hence, the income payable atretirement approximates the retirement income benefit payable haddisability not interrupted the active employment of the planparticipant.

Defined contribution plans such as 401(k) plans and non-traditionaldefined benefit plans such as cash balance plans are becomingincreasingly popular. These plans are beginning to offer new forms ofprotection to disabled employees as well. (Note again the claim ofpriority and incorporation by reference of U.S. patent application Ser.No. 08/936,037 regarding a method for making such coverage more widelyavailable.)

Private disability coverage, whether sponsored by employers or purchaseddirectly by individuals have overall coverage limitations. Generally,the available coverage is limited to no more than 66⅔% of gross earnedincome. Insurance companies can be reluctant to provide a higherpercentage of coverage due to the risk that a disabled insured will haveinsufficient economic incentive to go back to work. Often, thepercentage of gross earned income covered is considerably lower than66⅔%. This is because there are generally upper limitations on theamount of compensation covered (expressed in dollars, e.g., $200,000) orbecause only certain types of income are covered under disabilitypolicies (e.g., employer sponsored group long term disability insuranceoften excludes incentive compensation, commission income and othernon-salary compensation from the definition of covered income). Becausepeople who have private disability coverage are likely to receive 66⅔%or less of pre-disability income during disability, they are unlikely tobe able to continue contributing to IRAs at pre-disability levelswithout worsening their present financial hardship.

Of course, millions of Americans have no private disability coverage atall, and social security provides a modest disability benefit, but hasan extremely difficult definition of disability qualification to meet.Continuing IRA contributions at pre-disability levels will likely be theleast of the financial worries for those who do not own privatedisability insurance.

Currently, insurance or benefits designed to make up for lostcontributions (and the earnings thereon) to traditional IRAs or RothIRAs resulting from the disability of individual account holders doesnot exist. There are no known products (insurance or other) on themarket that provide this benefit.

Traditional disability income policies pay benefits during the time theperson is disabled. Traditional policy designs that pay benefits duringthe period of disability necessitate disability benefits being paideither; 1) directly to the disabled IRA participant; 2) into the IRA ofthe disabled participant, or, 3) into some other accumulation vehicle.The purpose of the desired coverage is to prevent diminishment ofretirement benefits that would have been accumulated or received had adisability not occurred. It is undesirable for the benefits to be at theimmediate disposal or discretion of the disabled participant when thedisability occurs. Firstly, the combined coverage may exceed theintended maximum of the insurance company or other benefit provider. Forexample, as stated previously, most insurers offering individual orgroup Long Term Disability (LTD) insurance seek to avoid coverageexceeding 66⅔% of compensation. Also, the participant may squander thebenefit on current expenses and still suffer diminishment of retirementbenefits.

There is a danger that the participant will squander benefits prior toretirement even if the benefit is payable to the IRA instead of to theparticipant. This is because Internal Revenue Code Section 408specifically requires that disabled participants be able to access IRAplan assets prior to age 59½ without excise tax in the event of thedisability the IRA owner. This provision of IRC Section 408 may explainwhy annuities sold as qualifying IRA plans have generally not included a“waiver of premium” option. A waiver of premium is an optional featureor rider offered in connection with certain life insurance and orannuity policies whereby premiums are waived under the contract during aqualifying disability. If a traditional waiver of premium approach isused with an IRC Section 408 qualified IRA, benefits (premiums waivedplus earnings) must be accessible to the disabled participantimmediately. There is therefore no assurance that benefits will not bediminished at retirement. There is also the possibility that the levelof combined currently available disability income benefits will exceedthe targeted maximum of the issuing insurance companies.

Making the benefit payable to a trust, annuity or other instrument mayaddress this problem. The vehicle must possess the necessaryrestrictions on withdrawals prior to retirement to assure benefits areultimately available at retirement. If this approach is used, theapplicable taxation of the accumulation vehicle must be taken intoconsideration. Traditional IRA contributions are sometimes deductible.In addition, the growth (income and gains) of invested contributions isnot subject to income taxation until distribution. If the disabilitybenefit is contributed into a vehicle with either nondeductiblecontributions or currently taxable investment growth, the participantwill suffer diminishment of retirement benefits. Because eachparticipant's income tax bracket and situation may differ, this raisesan almost infinite number of necessary corrective adjustments to offsetthe cost of taxes. Deferred annuities are not subject to income taxationon growth until distribution. However, in order for an annuity tocompletely avoid diminishment, the disability benefit must be grossed upso that the net after tax benefit matches the pre-disabilitycontribution amount (an infinite number of possible corrections). If thedisability benefit is paid into a deferred annuity on a tax-free basis,adjustments for non-deductibility may not be necessary. An annuity mayalso be desirable because some deferred annuities allow contract ownersto direct investment options. This may allow the disabled participant tocontrol annuity investment allocations in a fashion similar to IRAplans. However, we believe there are practical economic drawbacks to allof these approaches. Given that the maximum annual IRA contribution foran individual under current law is only $2,000 ($5,000 under proposedlegislation), the cost of having dollars flowing into either a trust orannuity with special restrictions, is likely to be prohibitive inrelation to the benefit. This may set the stage for a lack ofavailability of such a plan in connection with IRAs today. Plans usingthis approach are available in connection with replacing lostcontributions to private pension plans (where the annual contributionlimits are currently five times higher than for IRAs).

A possible alternative to deferred annuities or other accumulationvehicles that contain restrictions on plan withdrawals prior toretirement, is the disability policy or benefit itself. In order toavoid the diminishment risk described in the proceeding paragraphs, adisability policy or benefit would have to be designed with disabilitybenefit payouts deferred until retirement or other specified time.Additionally, the policy must provide a method of making up for lostasset growth on contributions or hypothetical contributions. This mightbe accomplished in a number of ways. The policy or benefit could have astated asset growth rate that the insurance company accrues oncontributions and account balances until retirement (at the insurancecompany's risk). For example, the policy may promise that the annualcontribution and account balance will grow at a specified rate (e.g., 8%per annum). If the insurance company earns less than 8% on its reserves,they are still obligated to pay benefits at 8%. If it earns more thanthe stipulated minimum return, it may either keep the excess return asprofit (non-participating policy) or share the excess return withpolicy-owners in the form of dividends (a participating contract).Instead of a fixed rate of growth, the rate credited to accruedcontributions and account balances may be tied to a published index suchas a United States Treasury Bond Index or the Standard & Poors 500Index. Once again, the insurance company may take the risk associatedwith delivering benefits at the promised growth rate and may issue thepolicy either on participating or non-participating basis. All of thedesigns mentioned thus far are examples of general account policies. Allpolicy reserves are held within the general account of the insurancecompany and are general obligations of the insurance company. Insurancecompanies might also design a disability policy with policy reservesheld in a separate account. The benefit obligations of these policiesare supported by the underlying assets held within the separate accountand is not a general obligation of the insurance company. Assets held inthe separate account are reserved for the exclusive benefit ofpolicyholders and are not chargeable with any other obligation of theinsurance company. Annual accrued benefit contributions and accountbalances within both general account policies and separate accountpolicies may be allocated by participants (generally, among severalinvestment divisions). Under this approach, the investment riskassociated with investment performance is borne primarily by eachdisabled participant (as opposed to the insurer).

Individuals can voluntarily purchase the various disability policy orbenefit designs described above or coverage may be made available onsome other basis. The financial institution offering a particular IRAproduct could offer the feature at no charge as a means of competingagainst other commercial IRA providers. Investment product vendors suchas mutual fund companies may incorporate a disability completion featurewithin certain mutual funds and absorb the cost of providing thefeature. They can also offer the feature as an optional benefit andcharge higher fees. Insurance companies might provide an annuity with asimilar feature or rider and either charge an additional fee or premiumor absorb the cost. Employers might pay for a benefit, either insured orotherwise, on the behalf of employees. This is more likely in thosesituations where an employer makes an IRA available to employees under apayroll deduction plan or on some other sponsored basis.

The form or design of coverage or benefits can vary greatly. Group orindividual disability policies may be used. It may be offered through arider to some other form of insurance policy. The benefit may beprovided as an implicit feature or provision of an account or otherinvestment vehicle. The investment vehicle or account in turn mightpurchase insurance to indemnify all or a portion of the risk. Benefitscan be paid in installments or in a lump sum.

Because there are currently no known disability policies or benefits onthe market that defer disability benefit payments until retirement (orearly retirement), there are no known computer software systems inexistence (with the exception of the above-referenced Ser. No.08/936,037) to track deferred disability payments, benefits, accountbalances, reserves or obligations. There are no known computer softwaresystems available to track the growth or hypothetical growth of deferreddisability benefits at either fixed rates or rates tied to indices withthe risk for attaining such growth borne by the insurance companies(either with a participating policy or a non-participating policy),reinsurance companies, mutual fund companies or any other company. Thereare currently no known systems available to track the growth of deferreddisability benefits with the growth of the deferred disability benefitstied to investment options selected by the disabled participant with theinvestment risk borne by the participant. There are no known computersoftware systems that calculate reserves, profits, losses, loss ratios,liabilities, or other actuarial factors for disability policies orbenefits with benefits deferred until retirement or other specifiedperiod. There are no known computer software systems designed forprimary insurance companies (insurance companies issuing the deferreddisability policy) designed to interact on an automated basis with thecomputer software systems of reinsurance companies reinsuring deferreddisability coverage. There are no known computer software systemsavailable to provide accounting, record keeping or other administrativeprocesses to insurance companies, reinsurance companies, mutual fundcompanies or any other company desiring to offer disability policieswith benefits that are deferred until retirement or early retirement.

In our previous patent application (U.S. patent application Ser. No.08/936,037), we identified a need for disability coverage protectingretirement benefits of individual participants within certain retirementplans qualified under Internal Revenue Code Section 401(a). We alsostated that it may in some instances be preferable to provide suchcoverage on a deferred basis (deferred until retirement or earlyretirement). Except for our subsequently discussed invention, we know ofno one else who has identified one other potential need to defer thepayment of disability benefits until retirement or early retirement inconnection with retirement plans qualified under Internal Revenue CodeSection 401(a), as follows. Many employers offer two or more retirementplans to employees that are qualified under IRC Section 401(a). In suchcases, the employer may wish to provide coverage to protect thecontributions made on behalf of individual participants who areparticipants in more than one plan. In such cases, it may be undesirableto purchase two or more separate policies (one in each of the plansqualified under Internal Revenue Code Section 401(a)) for eachparticipant. This would likely involve unnecessary duplication ofcertain expenses such as policy administration fees. It would be moreeconomical to purchase a single policy covering all contributions, or anapproximation of all contributions made on behalf of a singleparticipant in two or more retirement plans qualified under InternalRevenue Code Section 401(a). This will require placing such coverage ina single retirement plan qualified under Internal Revenue Code Section401(a). Payment of such consolidated coverage at the time of disabilitymay not always comply with funding limitations for the selected plan.Therefore, it may be necessary to pay such benefits directly to theparticipant at retirement or early retirement (or the accrued benefit toa beneficiary in the event the participant dies during such period). Inmaking the subsequently discussed invention, we believe that we are thefirst to have discovered this need or problem.

In recent years, politicians and others have opined that the currentU.S. social security retirement system is heading toward fiscal crises.Some believe that the financial danger is attributable to both thechanging demographics of the working population (the ratio of people whoare employed to the people who are receiving social security retirementbenefits has been steadily dropping for decades) and the low investmentperformance of current social security plan assets.

Historically, social security has not maintained or administeredindividual retirement accounts. Rather, aggregate plan liabilitiesdetermine aggregate funding goals.

In recent years, there have been several federal legislative proposalsto reform the U.S. social security retirement system. Among theseproposals are plans calling for the establishment of individual socialsecurity retirement accounts. Under one recent proposal, workers wouldbe able to select investment options by filling out forms filed withtheir taxes. Although such plans are not yet in operation for U.S.workers, the present invention is useful for such accounts for workersof those nations that currently provide social security retirement planswith individual plans, and of course the computing for such accounts canbe carried out anywhere (such as in the United States).

In light of the future financial problems of the current U.S. socialsecurity retirement system, legislation reforming the current systemseems almost unavoidable. Currently, social security disability benefitsare not based on individual retirement accounts. If legislation ispassed that includes the establishment of individual social securityretirement accounts, there will be an analogous need for entirely newtype(s) of disability benefits protecting retirement benefits. (Notethat the present invention is directed to computing operations, suchthat a particular embodiment of the invention and program code and/ordata may reflect changeable but readily discernable matters fromwhatever facts or law may be applicable, U.S. or otherwise.)

There are many possible ways of preserving individual social securityretirement account benefits in the event of disability.

In the case of individual social security retirement accounts, the costand amount of coverage and benefits may be calculated individually basedupon individual contributions or individual account balances. The costof the benefit may be charged according to individual coverage amountsor may be assessed according to other factors. It may be insured throughprivate insurance companies or self-insured by the Social SecurityAdministration (used herein as an example but intended to encompass thelike). If self insured, it may be self-insured through the establishmentof a special fund or reserve or the risk can be borne by the system insome other fashion. The Social Security Administration might purchaseinsurance to indemnify all or a portion of the risk. If insured byprivate insurance companies, a group policy might be used. Benefits maybe deferred until normal retirement or be payable at a special earlyretirement date. It is possible that both current and deferred benefitsmay be offered. Current and or deferred benefits might be linked toother social security disability benefits or may be calculated andfunded separately.

The existing Social Security Administration computer software system(s)doesn't administer (record, process, measure, facilitate, manage, etc.)disability benefits based upon individual social security retirementaccounts because the system doesn't maintain individual retirementaccount records at all. In fact, currently no known computer softwaresystem exists to administer individual social security retirementaccounts. A private study (see “Study Finds individual Account Costs CanBe Small” in Defined Contribution News Mar. 29, 1999 Vol. Vii, No. 7)was recently completed by Fred Goldberg, former Internal Revenue ServiceCommissioner, to assess the cost and feasibility of the creation of acomputer system capable of administering approximately 130 millionindividual social security retirement accounts. While the study wasoptimistic regarding the cost and feasibility of a computer system toadminister such accounts, no such system currently exists. Morerecently, the Employee Benefit Research Institute (EBRI) published abook titled “Beyond Ideaolgy: Are Individual Social Security AccountsFeasible?” The book is the compilation of the writings and research of24 distinguished authors. The entire book is dedicated to the questionsof whether a system can be developed to administer individual retirementaccounts for 148 million workers, and if so, to identify the logisticsfor implementing and administering such a gargantuan plan. Most of theauthors agree that it is feasible, however, there is considerabledisagreement as to the feasibility of certain approaches. Although thebook is over 200 pages long and provides detailed lists and descriptionsof complex tasks a system would have to perform to administer severalpossible plan designs, there is not a single mention of the need toadminister disability benefits as an element of the individual accounts.

These aspects of our subsequently discussed invention are believed to berepresentative of the background of the invention so far as we know andsubject to correction.

V. SUMMARY OF THE INVENTION

An object of the present invention is to address the issues of discussedabove with improved computer support.

More particularly, it is an object of the present invention to provide amethod, apparatus, article of manufacture, data structures, and inherentand necessary intermediates of a computer system to support disabilitybenefits or coverage to be offered to individual IRA participants withpayment of disability benefits deferred until retirement or earlyretirement.

It is an object of the present invention to provide a method, apparatus,article of manufacture, data structures, and inherent intermediates fora computer system to incorporate the additional features and processingfunctions to allow for the disability coverage to be offered within theplan while assuring ongoing plan compliance on an automated basis.

It is an other object of the present invention to enable disabilityissuing insurance carriers to rely upon a single digital system toperform all the data processing, coverage, premium and benefitcalculations, record keeping and other requisite functions attendant tooffering and administering group or individual disability insuranceprotecting retirement benefits under defined contribution plans (bothqualified and non-qualified) to all plan participants (both internal andexternal to the plan).

It is an other object of the present invention to provide fullyautomated digital importing and exporting capabilities, allowing data tobe quickly imported, processed and exported in any system format.

It is an other object of the present invention to provide an automatedmeans of calculating individual coverage and premium amounts accordingto the differing criteria and methodology of any issuing carrier.

It is an other object of the present invention to provide an automatedmeans of tracking initial and ongoing compliance of the disabilitycoverage under applicable state and federal law.

It is an other object of the present invention to provide an automatedmeans for tracking initial and ongoing compliance of qualified definedcontribution plans when disability insurance is either purchased withinthe QDCP trust or disability benefits are made payable to it.

It is an other object of the present invention to provide disabilityissuing insurance carriers a single digital system capable of performingall functions attendant to offering an administering thecoverage—irrespective of whether all plan participants are offeredcoverage or only selected participants (whether internal or external tothe plan).

It is an other object of the present invention to provide disabilityissuing insurance carriers a single digital system capable of performingall functions attendant to offering an administering the coverageirrespective of whether coverage is paid for by employee, employer, orshared by both trustee on behalf of either employee or employer or both.

It is an other object of the present invention to provide automatedpremium calculation based upon disability payments being made payable atthe time of disability or at a later time (i.e., early or normalretirement or another specified time).

It is an other object of the present invention to provide automatedpremium and coverage calculations at both the beginning of the 401(k)plan year and then again after final allowable contributions arecalculated under the 401(k)(m) rules.

It is an other object of the present invention to provide an automatedmeans of tracking and reporting morbidity, mortality and terminationexperience based upon any combination of in force business desired bycarrier, sponsoring employer, record keeper or other interested parties.

It is an other object of the present invention to provide an automatedmeans of providing coverage on a portable or non-portable basis.

It is an other object of the present invention to provide an automatedmethod of creating a paid-up (pre-paid) certificate or policy toterminating employees who end employment prior to the definedcontribution plan year.

It is an other object of the present invention to provide automatedtracking on a daily basis of unused premiums and to provide automatedreporting of any premium refunds due to participants who terminateemployment on any day prior to the defined contribution plan year.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system designed to receive data on an automated basisfrom parties that normally do defined contribution plan record keepingfor sponsoring employers.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to deliver data to the defined contributionrecord keepers on an automated basis.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to perform unused premium calculations on adaily basis for each covered defined contribution plan participant andcalculates applicable premium refunds for an employee who terminatesemployment prior to the last day of the DC plan year.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to interact with the computer system of aninsurance company providing deferred variable annuity contracts to holddisability proceeds until retirement age of the disabled definedcontribution plan participant (on an automated basis).

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to calculate disability amounts due in theevent of the disability of a covered participant and provide amount tothe insurer and the 401(k) record keeper on an automated basis.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to automatically create a pre-paid certificateor policy (either printed hard copy or digital extracts) for eachdefined contribution plan participant who terminates employment prior tothe final day of the plan year.

It is still another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to automatically import a employee census inany type of digital extract from another computer system, and convertinto any type of digital extract required by a different party (i.e.,receive an ASCII fixed width file from a 401(k) record keeper andconvert it into an ASCII delimited file for the insurance carrierproviding insurance).

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to calculate premium rates to insure againstlost retirement benefits under defined contribution plans irrespectiveof whether coverage is provided under a group policy or an individualpolicy.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to calculate premium rates to insure againstlost retirement benefits under defined contribution plans irrespectiveof whether coverage is portable or not portable by an employee whenterminating employment.

It is still a further object of the present invention to provide amethod, apparatus, article of manufacture, and data structures for adisability insurance computer system to calculate premium rates toinsure against lost retirement benefits under defined contribution plansirrespective of whether benefits are payable at the time of disabilityor deferred to a pre-determined date (i.e., normal or early retirement).

It is still a further object of the present invention to provide amethod, apparatus, article of manufacture, and data structures for adisability insurance computer system to calculate premium rates toinsure against lost retirement benefits under 401(k) definedcontribution plans on an interim basis while final contributions arepending confirmation under 401(k)(m) rules.

It is still a further object of the present invention to provide amethod, apparatus, article of manufacture, and data structures for adisability insurance computer system to automatically provide morbidity,termination and mortality experience reports to plan sponsors andinsurers based upon any combination of defined contribution population.

These and other objects of the present invention are carried out by adigital system performing the digital signal processing for generatingoutput useful in administrating disability coverage to employeeparticipants of all types of retirement income plans and to performevery aspect of ongoing administration of such coverage.

The computer system used to enable issuing insurance carriers to offerdisability coverage to the participants of any type of definedcontribution pension or profit sharing plan. We have invented ourcomputer system as an extremely robust environment and with the featuresand automated capabilities to allow any combination of premium paymentsources and any combination of benefit payment timing and recipients.Our computer system allows an issuing insurance carrier to offerdisability products to the majority of Americans dependent uponqualified defined contribution plans for part of their retirementbenefits.

All qualified defined contribution plans must meet complex rules andregulations for maintaining tax qualification under ERISA (as amended).None of the existing disability insurance computer system takes theserules and regulations into consideration. Our computer system does.

For example, 401(k) plans have extremely precise and complicatednon-discrimination testing (the 401(k)/(m) rules). Premiums fordisability insurance coverage will almost always be related to the levelof contribution being made or the retirement benefit likely to beaccumulated as a result of contributions being made. An employee'sinitial yearly contribution commitment to the 401(k) plan is not areliable source for calculating either the amount of disability coverageor the premium cost thereof because final allowable yearly contributionamounts must be confirmed by testing under the 401(k)/(m) rules.

The computer system utilized to calculate individual disability coverageamounts for 401(k) plan participants must be capable of receivingparticipant census and contribution data from the 401(k) plan recordkeeper (who will perform the 401(k)/m testing and have the finalcontribution amounts for each participant). If the computer system cannot effectively interface with the 401(k) record keeper's systems, theemployer is required to act as an intermediary—necessitating extra work,expense and inconvenience on behalf of the employer.

Another example of a defined contribution rule impacting the capabilityof a computer system is what may be required when an employee terminatesemployment during a 401(k) plan year. The employee must be 100% vestedin all voluntary contributions to 401(k) plans. They may also bepartially vested or fully vested in employer contributions dependentupon years of participation in the plan at the time of termination. Thismay entitle a terminating employee to a partial refund of the disabilityinsurance premium (the unused premium) if they terminate employment fromthe sponsoring employer during the 401(k) plan year (any day prior tothe final day of the plan year). The system must be capable of trackingthe unused premium to determine if and how much a refund is due. No suchrefund must be tracked by conventional disability computer systems.

There is also usually a difference between employees participating inconventional employer sponsored disability coverage and thoseparticipating in defined contribution plans. This is because theemployer can define a different minimum employment periods foreligibility under each plan. In addition if participation in the definedcontribution is voluntary, employees choosing not to participate mustnot be covered under the disability plan. So even the census data mustusually be prepared by the defined contribution plan record keeper forthe initial disability plan to be set up and updated yearly. Thisinformation must be put into the computer program in a way acceptable tothe record keeper and the employer. Our system was invented to allow anymethod preferred by them (automated import of any type of file form anytype of media, scanned hard copy or manual input).

One final example of the inadequacy of prior computer systems revolvesaround the defined contribution plan record keeper's ability orinability to track pre-disability assets separately from post-disabilityassets. Many disability carriers will require that disability benefitsbe inaccessible to disabled employees until retirement. Many definedcontribution plans allow disabled employees to access their planbenefits early in the event of certain qualifying hardships (thisusually includes disability). If benefits are paid into the definedcontribution plan at the time of disability and the record keeper cannot account for them (along with investment earnings) separately fromthe pre-disability asset and subsequent earnings, than some means ofseparation must be provided. One solution is to direct disabilitypayments into an annuity either within or external to the definedcontribution plan, Conventional disability insurance computer programswere not designed to interact with annuity providers on an automatedbasis. Our system was invented taking this need into consideration.

There are several additional features that prior disability insurancecomputer systems did not take into consideration because of they werenot designed with the special needs and requirements of definedcontribution plans in mind. Our system was specifically designed toaccommodate the special needs of offering disability protection againstdefined contribution plan benefits. A comprehensive description of thesefeatures and capabilities is included in system description.

More particularly, the invention includes method for using a digitalelectrical apparatus for signal processing, the method including:providing a digital electrical computer apparatus comprising a firstdigital electrical computer having a processor, the processorelectrically connected to store and receive electrical signals at amemory device, to receive electrical signals representing the inputinformation from an input device, to convert output electrical signalsinto printed documentation at a printer, wherein the processor isprogrammed to control the first digital electrical computer to receivethe input electrical signals and to process the input electrical signalsto produce the output electrical signals, including: receiving the inputinformation at the input device, the input information including amountsof contribution for employees in a defined contribution plan; processingthe input electrical signals from a first format such that for each ofthe employees, a respective coverage amount is computed by using thecontributions to the defined contribution plan; processing the inputelectrical signals such that for each of the coverage amounts, acorresponding insurance premium is calculated; generating a billingstatement at the printer from the output electrical signals, the outputelectrical signals representing billing statement data including theemployees coverage amounts and the insurance premiums; storing thebilling statement data; recalling the stored billing statement data, andfor each of the employees in the defined contribution plan terminatedprior to an end of a year for the defined contribution plan, using thestored billing statement data to compute an amount of consideration tobe given the employee terminated; and generating a record at the printerfrom further output electrical signals representing a confirmation ofthe consideration. Further, the invention includes a multi-computersystem incorporating the foregoing. A second digital electrical computeris for storing the electrical signals in a second memory, the electricalsignals representing the input information in a second format exportedto the input device connected to the first digital electrical computer;the method further comprising the steps of converting the second formatinto the first format to enable the step of receiving the inputinformation to be carried out by reading the exported electrical signalsfrom the second digital electrical computer; and, wherein the step ofstoring is carried out by converting the first format into the secondformat for exporting the billing statement data to the second digitalelectrical computer for storage at a second memory electricallyconnected to the second digital electrical computer.

The invention can thus be viewed as a digital system capable ofperforming calculations required to illustrate and offer disabilitycoverage to employee participants of all types of retirement incomeplans and to perform every aspect of ongoing administration of suchcoverage. The system is capable of performing calculations,illustrations and ongoing administrative functions regardless of whethercoverage is provided through a group insurance contract or throughindividual policies. The system performs these functions irrespective ofwhether coverage is paid for by the employee, paid for by the employer(directly or indirectly) or premium cost is shared by employer andemployee. The timing of benefits paid in the event of the disability ofa covered participant may either occur at the time of disability or maybe deferred until normal or early retirement or until some otherspecified date. The system manages all requisite records irrespective ofthe timing of benefit payments. The system performs comprehensivefunctions attendant to various mechanical and or structural approachesfor providing coverage, including:

1. Premiums are paid within a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to the qualified pensionor profit sharing plan (including to an annuity contract within thetrust).2. Premiums are paid within a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to the plan participantwho is disabled.3. Premiums are paid within a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to a group or individualannuity outside of the qualified pension or profit sharing trust.4. Premiums are paid within a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to a non-qualified trustwhich may hold funds in various investments including group orindividual annuities.5. Premiums are paid outside a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to the qualified pensionor profit sharing plan (including to an annuity contract within thetrust).6. Premiums are paid outside a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to the plan participantwho is disabled.7. Premiums are paid outside a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to a group or individualannuity outside of the qualified pension or profit sharing plan trust.8. Premiums are paid outside a qualified pension or profit sharing plan(ERISA trust) with disability benefits payable to a non-qualified trustwhich may hold funds in various investments including group orindividual annuities.9. Premiums are paid in a qualified Section 125 Welfare Benefit Plantrust with disability benefits payable to the qualified pension orprofit sharing plan (including to an annuity contract within the trust).10. Premiums are paid in a qualified Section 125 Welfare Benefit Plantrust with disability benefits payable to the plan participant who isdisabled.11. Premiums are paid in a qualified Section 125 Welfare Benefit Plantrust with disability benefits payable to a group or individual annuityoutside of the qualified pension or profit sharing plan trust.12. Premiums are paid in a qualified Section 125 Welfare Benefit Plantrust with disability benefits payable to a non-qualified trust whichmay hold funds in various investments including group or individualannuities.13. Premiums are paid in a qualified IRC Section 501(c)(9) WelfareBenefit Plan or VEBA Trust (Voluntary Employee Beneficiary Association)with disability benefits payable to the qualified pension or profitsharing plan (including to an annuity contract within the trust).14. Premiums are paid in a qualified IRC Section 501(c)(9) WelfareBenefit Plan or VEBA Trust (Voluntary Employee Beneficiary Association)with disability benefits payable to the plan participant who isdisabled.15. Premiums are paid in a qualified IRC Section 501(c)(9) WelfareBenefit Plan or VEBA Trust (Voluntary Employee Beneficiary Association)with disability benefits payable to a group or individual annuityoutside of the qualified trust.16. Premiums are paid in a qualified IRC Section 501(c)(9) WelfareBenefit Plan or VEBA Trust (Voluntary Employee Beneficiary Association)with disability benefits payable to a non-qualified trust which may holdfunds in various investments including group or individual annuities.17. Premiums are paid in a qualified IRC Section 419 (e) Welfare BenefitPlan with disability benefits payable to the qualified pension or profitsharing plan (including to an annuity contract within the trust).18. Premiums are paid in a qualified IRC Section 419 (e) Welfare BenefitPlan or VEBA Trust (Voluntary Employee Beneficiary Association) withdisability benefits payable to the plan participant who is disabled.19. Premiums are paid in a qualified IRC Section 419 (e) Welfare BenefitPlan or VEBA Trust (Voluntary Employee Beneficiary Association) withdisability benefits payable to a group or individual annuity outside ofthe qualified pension or profit sharing plan trust.20. Premiums are paid in a qualified IRC Section 419 (e) Welfare BenefitPlan or VEBA Trust (Voluntary Employee Beneficiary Association) withdisability benefits payable to a non-qualified trust which may holdfunds in various investments including group or individual annuities.

When premiums are paid within the qualified pension or profit sharingplan, the system is capable of performing certain tasks and calculationsthat otherwise may not be required—including calculating imputed incomefor each plan participant. Imputed income is calculated according to netpremiums paid (taking into consideration any refunds or otheradjustments during the calendar year) and when applicable will includeany employer bonus to cover all or a portion of the tax expense forimputed income. Additionally, the system is able to automatically createIRS 1099 Forms to report imputed income to each participant yearly.Alternatively, the system can provide digital extracts in multiplesystem formats or hardcopy to allow another party to prepare the 1099Forms (i.e., employer, pension plan record keeper, payroll service,insurance company, disability plan TPA, or other authorized party).

In the event the policy is portable (the employee can optionallycontinue to pay premiums and retain coverage after terminatingemployment with the original sponsoring employer), the system willautomatically create the billing documents to be mailed to eachterminated employee electing to continue coverage. The system cangenerate the actual hard copy billing statement for direct mailing orprovide digital extracts in multiple system formats allow another partyto prepare and or forward the bill (i.e., insurance company, disabilityplan TPA, or other authorized party).

The system creates the plan level billing statement for all planparticipants to include the total plan premium cost on any billing cyclerequired for a given plan (i.e., annually, semi-annually, quarterly,monthly, bi-monthly, weekly or other billing cycle). The systemautomatically provides digital extracts in multiple system formats orhard copy to allow another party (i.e., employer, pension plan recordkeeper, payroll service, insurance company, disability plan TPA, orother authorized party) to prepare and deliver the billing to theappropriate party (i.e., employer, plan trustee, payroll service orparticipant).

It is an other object of the present invention to enable disabilityissuing insurance carriers, mutual fund companies, other IRA providersand the Social Security Administration or an entity performingadministration on behalf of the Social Security Administration, adigital system to perform data processing, calculation of coverage andor benefits, premium, and/or other consideration, record keeping andother requisite functions attendant to offering and administering groupor individual disability insurance or benefits protecting retirementbenefits under IRA plans and or individual social security retirementaccounts (both internal and external to the plan).

It is an other object of the present invention to provide fullyautomated digital importing and exporting capabilities, allowing data tobe quickly imported, processed and exported in any system format.

It is an other object of the present invention to provide an automatedmeans calculating individual benefits or coverage and premium amountsaccording to the differing criteria and methodology of any issuingcarrier, mutual fund company, or other IRA provider and or SocialSecurity Administration or an entity performing administration on behalfof the Social Security Administration.

It is an other object of the present invention to provide an automatedmeans tracking initial and ongoing compliance of the disability benefitsor coverage under applicable state and federal law.

It is an other object of the present invention to provide disabilityissuing insurance carriers, mutual fund companies, and other IRAproviders and the Social Security Administration or an entity performingadministration on behalf of the Social Security Administration, a singledigital system capable of performing all functions attendant to offeringand administering the benefit or coverage—irrespective of whether thebenefit or coverage is contributory, non-contributory, voluntary, ormandatory.

It is an other object of the present invention to provide disabilityissuing insurance carriers, mutual fund companies and other IRAproviders, and or Social Security Administration or an entity performingadministration on behalf of the Social Security Administration, adigital system capable of performing all functions attendant to offeringand administering the benefits or coverage—irrespective of whethercoverage is paid for on a voluntary basis or mandatory basis.

It is an other object of the present invention to provide automatedpremium, contribution or other consideration calculations based upondisability benefit payments being made payable either at the time ofdisability or at a later time (e.g., early or normal retirement or atthe death of the participant).

It is an other object of the present invention to provide an automatedmeans tracking and reporting morbidity experience, mortality experience,and termination experience based upon any combination of in forcebusiness desired by carrier, mutual fund company, other IRA provider,Social Security Administration, or an entity performing administrationon behalf of the Social Security Administration.

It is an other object of the present invention to provide an automatedmeans providing (or supporting providing) benefits or coverage internalto the IRA or individual social security retirement account or externalto the IRA or individual social security retirement account.

It is an other object of the present invention to provide an automatedmethod of creating a paid-up (pre-paid) certificate or policy toindividuals terminating premium payments or contributions for benefitsor coverage.

It is an other object of the present invention to provide automatedtracking on a daily or periodic basis of unused premiums orcontributions and to provide automated reporting of any premium refundsdue to participants who terminate benefits or coverage.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to receive data on an automatedbasis from parties that perform plan record keeping for retirement planson behalf of sponsoring employers or the Social Security Administration.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to deliver data to the recordkeepers on an automated basis.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to perform unused or unearnedpremium or contribution calculations on a daily basis for each covereddefined contribution plan participant and calculates applicable premiumrefunds and reserves for a person terminating benefits or coverage.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to calculate disability amounts duein the event of the disability of a covered participant and provideamount to the insurer, mutual fund companies, other IRA providers andthe Social Security Administration or an entity performingadministration on behalf of the Social Security Administration on anautomated basis.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance computer system to automatically create a pre-paid certificateor policy (either printed hard copy or digital extracts) for each planparticipant who terminates plan participation or premium payments orcontributions prior to the final day of the benefits plan or policyyear.

It is still another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to automatically import aparticipant census in any type of digital extract from another computersystem, and convert into any type of digital extract required by adifferent party (i.e., receive an ASCII fixed width file from a recordkeeper and convert it into an ASCII delimited file for the insurancecarrier providing insurance).

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefit computer system to calculate premium orcontribution rates to insure against lost retirement benefits under IRAplans and individual social security retirement accounts irrespective ofwhether coverage is provided under a group policy or an individualpolicy.

It is yet another object of the present invention to provide a method,apparatus, article of manufacture, and data structures for a disabilityinsurance or benefits computer system to calculate premium orcontribution rates to insure against lost retirement benefits under IRAplans and individual social security retirement accounts irrespective ofwhether coverage is insured directly, self-insured, partiallyself-insured, reinsured or partially reinsured.

It is still a further object of the present invention to provide amethod, apparatus, article of manufacture, and data structures for adisability insurance or benefits computer system to calculate premium orcontribution rates to insure against lost retirement benefits under IRAplans and individual social security retirement accounts irrespective ofwhether benefits are payable at the time of disability or deferred to apre-determined date (e.g., normal or early retirement).

It is still a further object of the present invention to provide amethod, apparatus, article of manufacture, and data structures for adisability insurance or benefit computer system to automatically providemorbidity experience, mortality experience, termination experience,reserves and reports to IRA plan sponsors, insurers and the SocialSecurity Administration or an entity performing administration on behalfof the Social Security Administration based upon any combination of thecovered or insured population.

These and other objects of the present invention are carried out by adigital system performing the digital signal processing for generatingoutput useful in supporting and/or administrating disability benefits orcoverage for participants of all types of retirement plans maintainingindividual retirement accounts and to perform every aspect of ongoingadministration of such coverage or benefits.

The computer system used to enable issuing insurance carriers, mutualfund companies, other IRA providers and the Social SecurityAdministration to offer disability coverage or benefits to theparticipants of IRA plans or the individual social security retirementaccounts. The computer system in an extremely robust environment andwith features and automated capabilities to allow any combination ofpremium payment or contribution sources and any combination of benefitpayment timing and recipients. Our computer system allows an issuinginsurance carrier, mutual fund company and other IRA providers to offerdisability products or benefits to the majority of Americans dependentupon IRA plans for part of their retirement benefits.

The computer system also includes features and automated capabilities toallow any combination of premium payment, contributions, reservecontributions, accrued liability calculations, and reserve amounts to berecorded in connection with individual social security retirementaccounts.

The computer system is structured to calculate individual disabilitycoverage or benefit amounts for individual social security retirementaccount plan participants must be capable of receiving participantcensus and contribution data from record keeping systems responsible forcollecting such data or must be incorporated into the existing recodekeeping systems containing such data. If the computer system cannoteffectively interface with record keeping systems, the Social SecurityAdministration or an entity performing administration on behalf of theSocial Security Administration is required to manually enter all therequired data necessitating extra work, expense and inconvenience.

One example of the inadequacy of prior computer systems revolves aroundthe system's ability or inability to track pre-disability assetsseparately from post-disability assets. Many disability carriers mutualfund companies, other IRA providers and the Social SecurityAdministration or an entity performing administration on behalf of theSocial Security Administration will require that a portion of disabilitybenefits be inaccessible to disabled participants until retirement.Under IRC 408, IRA plans must allow disabled participants to accesstheir plan benefits early in the event of certain qualifying hardships(this usually includes disability). While it is impossible to know atthis time, Individual Social Security Retirement Accounts, if created inthe U.S. too, may include similar provisions. If benefits are paid intoor accrued within an IRA plan, or individual social security retirementaccounts at the time of disability and the record keeper can not accountfor them (along with investment earnings) separately from thepre-disability asset and subsequent earnings, than some means ofseparation must be provided. One solution for IRAs is to directdisability payments into an annuity external to the IRA plan.Conventional disability insurance computer programs were not designed tointeract with annuity providers on an automated basis. Our system wasstructured to address this need.

There are several additional features that prior disability insurancecomputer systems did not take into consideration because of they werenot designed with the special needs and requirements of IRA plans orindividual social security retirement accounts in mind. Our system wasspecifically designed to accommodate the special needs of offeringdisability protection or benefits against contributions to IRAs andindividual social security retirement accounts. A comprehensivedescription of these features and capabilities is included in the systemdescription.

More particularly, the invention includes a method for using a digitalelectrical apparatus programmed for signal processing in accordance withthe method including: providing a digital electrical computer apparatuscomprising a first digital electrical computer having a processor, theprocessor electrically connected to store and receive electrical signalsat a memory device, to receive electrical signals representing the inputinformation from an input device, to convert output electrical signalsinto printed documentation at a printer, wherein the processor isprogrammed to control the first digital electrical computer to receivethe input electrical signals and to process the input electrical signalsto produce the output electrical signals, including: receiving the inputinformation at the input device, the input information including amountsof contribution for participants in a IRA plan; and or participants inindividual social security retirement accounts processing the inputelectrical signals from a first format such that for each of theparticipants, a respective coverage amount is computed by using thecontributions to the IRA plan and or individual social securityretirement account; processing the input electrical signals such thatfor each of the coverage or benefit amounts, a corresponding insurancepremium or other contribution is calculated; generating a billing orcontribution statement at the printer from the output electricalsignals, the output electrical signals representing billing orcontribution statement data including the participants coverage amountsand the insurance premiums and or contributions; storing the billing orcontribution statement data; recalling the stored billing orcontributions statement data, and for each of the participants in theIRA plan and or individual social security retirement account terminatedprior to an end of a year for the respective plans, using the storedbilling or contribution statement data to compute an amount ofconsideration to be given the participant terminated; and generating arecord at the printer from further output electrical signalsrepresenting a confirmation of the consideration. Further, the inventionincludes a multi-computer system incorporating the foregoing. A seconddigital electrical computer is programmed for storing the electricalsignals in a second memory, the electrical signals representing theinput information in a second format exported to the input deviceconnected to the first digital electrical computer; the method furthercomprising the steps of: converting the second format into the firstformat to enable the step of receiving the input information to becarried out by reading the exported electrical signals from the seconddigital electrical computer; and, wherein the step of storing is carriedout by converting the first format into the second format for exportingthe billing or contribution statement data to the second digitalelectrical computer for storage at a second memory electricallyconnected to the second digital electrical computer.

The invention can thus be viewed as a digital system capable ofperforming calculations required to illustrate and offer disabilitycoverage or benefits to participants of all types of IRA plans andindividual social security retirement account plans and to perform everyaspect of ongoing administration of such coverage or benefits. Thesystem is capable of performing calculations, illustrations and ongoingadministrative functions regardless of whether coverage or benefits areprovided through a group insurance contract, through individualpolicies, through a self-insured plan, through a partially self-insuredplan, and through a reinsured plan. The system performs these functionsirrespective of whether the cost of coverage (premium or otherconsideration) is paid for by the participant, paid for by an employer,is shared by participant and employer, is paid by the insurer, themutual fund company, the IRA provider, paid through FICA withholdings,or from other federal taxes. The timing of benefits paid in the event ofthe disability of a covered participant may either occur at the time ofdisability or may be deferred until normal or early retirement or paidto a beneficiary in the event of the death of the participant. Thesystem manages all requisite records irrespective of the timing ofbenefit payments. The system is structured to perform comprehensivefunctions attendant to various mechanical and or structural approachesfor providing coverage or benefits and calculates premium cost or otherconsideration, including:

1. Premiums or other consideration are paid within an IRA plan withdisability benefits payable to the IRA plan, including to an annuitycontract within the plan.2. Premiums or other consideration are paid within an IRA plan withdisability benefits payable directly to the disabled participant ornamed beneficiary at the time of disability or deferred until retirementearly retirement or the death of the participant.3. Premiums or other consideration are paid within an IRA plan withdisability benefits payable to a group or individual annuity outside ofthe IRA plan.4. Premiums or other consideration are paid within an IRA plan withdisability benefits payable to a trust which may hold funds in variousinvestments including group or individual annuities.5. Premiums or other consideration are paid outside an IRA plan withdisability benefits payable to a separate IRA plan.6. Premiums or other consideration are paid outside an IRA plan withdisability benefits payable to the disabled participant or namedbeneficiary at the time of disability or deferred until retirement earlyretirement or the death of the participant.7. Premiums or other consideration are paid outside an IRA plan withdisability benefits payable to a group or individual annuity outside ofthe IRA plan.8. Premiums or other consideration are paid outside an IRA plan withdisability benefits payable to a trust which may hold funds in variousinvestments including group or individual annuities.9. Premiums or other consideration are paid within a Internal RevenueCode (IRC) Section 125 Welfare Benefit Plan trust with disabilitybenefits payable to an IRA plan, including to an annuity contract withinthe trust.10. Premiums or other consideration are paid in a IRC Section 125Welfare Benefit Plan trust with disability benefits payable to thedisabled plan participant or named beneficiary at the time of disabilityor deferred until retirement, early retirement or the death of theparticipant.11. Premiums or other consideration are paid in a IRC Section 125Welfare Benefit Plan trust with disability benefits payable to a groupor individual annuity outside of the IRA plan.12. Premiums or other consideration are paid in a IRC Section 125Welfare Benefit Plan trust with disability benefits payable to a trustwhich may hold funds in various investments including group orindividual annuities.13. Premiums or other consideration are paid in a IRC Section 501(c)(9)Welfare Benefit Plan with disability benefits payable to an IRA plan,including to an annuity contract within the IRA.14. Premiums or other consideration are paid in a IRC Section 501(c)(9)Welfare Benefit Plan with disability benefits payable to the disabledplan participant or named beneficiary at the time of disability ordeferred until retirement, early retirement or the death of theparticipant.15. Premiums or other consideration are paid in a IRC Section 501(c)(9)Welfare Benefit Plan with disability benefits payable to a group orindividual annuity outside of the trust.16. Premiums or other consideration are paid in a IRC Section 501(c)(9)Welfare Benefit Plan with disability benefits payable to a trust whichmay hold funds in various investments including group or individualannuities.17. Premiums or other consideration are paid in a IRC Section 419 (e)Welfare Benefit Plan with disability benefits payable to an IRA plan,including to an annuity contract within an IRA.18. Premiums or other consideration are paid in a IRC Section 419 (e)Welfare Benefit Plan with disability benefits payable to the disabledplan participant or named beneficiary at the time of disability ordeferred until retirement, early retirement or the death of theparticipant.19. Premiums or other consideration are paid in a IRC Section 419 (e)Welfare Benefit Plan with disability benefits payable to a group orindividual annuity outside of the IRA.20. Premiums or other consideration are paid in a IRC Section 419 (e)Welfare Benefit Plan with disability benefits payable to a trust whichmay hold funds in various investments including group or individualannuities.21. Premiums or other consideration are paid by a mutual fund company orother IRA provider on behalf of a common group of IRA participants.22. Premiums or other consideration are absorbed by a mutual fundcompany or other IRS provider on behalf of a common group of IRAparticipants.23. Premiums or other consideration are paid for from a portion of FICAtaxes for participants of individual social security retirementaccounts.24. Premiums or other consideration are paid from taxes other than FICAtax for participants of individual social security retirement accounts.

When premiums are paid within any of the qualified Welfare Benefit plansidentified above, the system is capable of performing certain tasks andcalculations that otherwise may not be required—including calculatingimputed income for each plan participant. Imputed income is calculatedaccording to net premiums paid (taking into consideration any refunds orother adjustments during the calendar year) and when applicable willinclude any employer bonus to cover all or a portion of the tax expensefor imputed income. Additionally, the system is able to automaticallycreate IRS 1099 Forms to report imputed income to each participantyearly. Alternatively, the system can provide digital extracts inmultiple system formats or hardcopy to allow another party to preparethe 1099 Forms (i.e., employer, Welfare Benefit Plan record keeper,payroll service, insurance company, disability plan TPA, or otherauthorized party).

In the event the policy or benefit is portable (the employee canoptionally continue to pay premiums and retain coverage afterterminating employment with an original sponsoring employer), the systemwill automatically create the billing documents to be mailed to eachterminated employee electing to continue coverage or benefits. Thesystem can generate the actual hard copy billing statement for directmailing or provide digital extracts in multiple system formats toprovide the billing electronically via the Internet or to allow anotherparty to prepare and or forward the bill (i.e., insurance company,disability plan TPA, or other authorized party).

The system creates the plan level billing statement for all planparticipants in a sponsored Plan to include the total plan premium coston any billing cycle required for a given plan (i.e., annually,semi-annually, quarterly, monthly, bi-monthly, weekly or other billingcycle). The system automatically provides digital extracts in multiplesystem formats or hard copy to allow another party (i.e., employer,Welfare Benefit Plan, record keeper, payroll service, insurance company,disability plan TPA, mutual fund company or other party) to prepare anddeliver the billing to the appropriate party (i.e., employer, plantrustee, payroll service or participant).

Even more particularly, the present invention relates to an improveddigital electrical computer-based system configured to address theforegoing objects, including a machine (programmed computer), methodsfor making and using it, products produced by the method, datastructures, and necessary intermediates, collectively referenced hereinafter as the method (for the sake of brevity). The present inventionincludes a computer-aided method of computing coverage benefit costs fora retirement plan having respective accounts for individuals, the methodcomprising the steps of: converting input plan contribution data for atleast one of said accounts of said retirement plan into correspondinginput digital electrical signals; manipulating the input digitalelectrical signals in computing the coverage benefit costs for the atleast one of said accounts according to said retirement plan; andproducing output at an output device the output including the computedcoverage benefit costs for the at least one of said accounts of saidretirement plan.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan according to an individualsocial security account.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 408.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 408 wherein said individual accountqualifies as a ROTH IRA.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 401(a).

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 401(a) in which there are designatedplus accounts for qualified plus contributions.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 403(b).

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for the at least one of saidindividual accounts of said retirement plan, said plan being qualifiedunder Internal Revenue Code Section 457.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for at least two of said individualaccounts of a single participant of at least two said retirement plans,said plans being qualified under Internal Revenue Code Section 401(a).

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan according to an individual social security account.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 408.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 408 wherein said individual account qualifies as a ROTH IRA.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 401(a).

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 401(a) in which there are designated plus accounts for qualifiedplus contributions.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 403(b).

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant, and the computing also includes computing the coveragebenefit costs for the at least one of said individual accounts of saidretirement plan, said plan being qualified under Internal Revenue CodeSection 457.

In any of the embodiments discussed herein, the computing can includecomputing the coverage benefit costs for benefits commencing at theearliest of retirement, early retirement, or the death of theparticipant for at least two of said individual accounts of a singleparticipant of at least two said retirement plans, said plans beingqualified under Internal Revenue Code Section 401(a).

In any of the embodiments discussed herein, converting input plancontribution data can include converting input FICA tax data.

In any of the embodiments discussed herein, converting input plancontribution data can include converting input Federal Old Age,Survivors, and Disability Insurance tax data.

In any of the embodiments discussed herein, converting input plancontribution data can include converting input Federal Old Age,Survivors Insurance tax data.

Representative of a preferred embodiment of the invention, pleaseconsider the following brief description of the drawings set forthbelow.

VI. BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a representation of an apparatus in accordance with thepresent invention.

FIG. 2 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 3 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 4 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 5 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 6 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 7 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 8 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 9 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 10 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 11 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 12 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 13 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 14 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 15 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 16 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 17 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 18 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 19 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 20 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 21 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 22 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 23 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 24 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 25 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 26 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 27 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 28 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 29 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 30 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 31 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 32 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 33 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 33 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 34 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 35 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 36 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 37 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 38 is a representation of a screen produced on a visual outputdevice in accordance with the present invention, the screen includingoutput for incorporating into printed output at a hard copy outputdevice.

FIG. 39 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 40 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 41 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 42 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 43 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 44 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 45 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 46 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 47 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 48 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 49 is a representation of a screen produced on a visual outputdevice in accordance with the present invention.

FIG. 50 is a flow chart for the method carried out by the apparatus ofthe present invention.

VII. DETAILED DESCRIPTION OF A PREFERRED EMBODIMENT

As a preferred embodiment exemplifying the invention, begin byconsidering FIG. 1, which shows, in block diagram form, thecomputer-based elements which can be utilized to implement the presentinvention. The present invention involves computer apparatus system 1,which includes processor circuitry 2 in a first digital electricalcomputer 2, which can for example be at a workstation, PC, etc. Forflexibility, it is preferable to have the processor circuitry 2 formedby means of a computer program programming programmable circuitry, i.e.,programming the computer (processor) logic circuitry. The programmingcan be carried out with a computer program (or programs) 6, which forflexibility should be in the form of software stored in an externalmemory 8, such as a diskette, hard disk, virtual disk, or the like. (Thevirtual disk is actually an extended internal memory 10 which may assistin speeding up computing.) A diskette approach is optional, but it doesprovide a useful article of manufacture for inputting or storing datastructures or the host software. Of course storing the computer program6 in a software device is optional because it is well known in the artthat the same result can be obtained by storing the computer program ina hardware storage device, e.g., by burning the computer program 6 intoa ROM.

An embodiment could equivalently be carried out in hardware, though thisis not recommended as it is an inflexible approach. Accordingly, ahardware implementation is described here for exemplary purposes, but asoftware approach is preferable for flexibility. Of course it is wellknown that a computer program can be stored in hardware by manyapproaches, not the least of which is burning it into a ROM. Moresophisticated than burning a ROM, but also entirely conventional, is touse techniques to translate the computer program 6 into an ASIC or achip that will carry out the invention in an equivalent manner, and infact with equivalent circuitry to that formed by programmingprogrammable computer circuitry. It is all just digital electricalcircuitry processing digital electrical signals, transforming them tooutput different electrical signals.

An internal memory 10 works in cooperation with the external memory 8.An input device 12 could be a keyboard, scanner, modem, disk drive,mouse, or equivalent means for a user to input the data discussed below(which can alternatively be input indirectly via another computer 18 or19 linked by modem or network and server computer 4—or data canalternatively be read from a disk or other memory media having dataproduced thereon by such a digital electrical computer). A visualdisplay unit 14 can be employed for a visual representation, and a hardcopy output device 16, such as a laser printer, bubble jet printer, dotmatrix printer or the like, can be employed for producing hard copyoutput documentation 22. The documentation can include, for example, taxdocuments 3, premium statements 5 or other consideration confirmations13, billing statements 7, tax reports 9, historical reports 11,experience reports, claims reports, accounting reports, andconsideration confirmations 13 (discussed further below).

Note that output electrical data can also be stored to memory 8 indatabase 20, moved to the server and other computers 18, or conveyed toan output device 15, such as a modem (which could be the same modem asthe input device 12).

Local files 24, data files 26, user utilities 28, and reference files 30are shown in FIG. 1 as located in database 20, though these are mostlysystem files available to the System Database 32.

Note too how there are two routs for certain data to be conveyed intothe computer 4. The first way is to take such information as planparticipation data 21, carrier data 23, record keeper data 25, and plansponsor data 27 and input the information at the input device 12, e.g.,scan hard copy, type in at keyboard, etc. In this case, input device 12receives input information and, in response, changes the informationinto (input) electrical signals corresponding to the input information.A second way is to do the same at an input device 17 connected to somesecond digital electrical computer having a programmed processor 31.

The present invention can be carried out by using a Client Server 18running in Microsoft Windows 95, Windows 98, Windows 2000 and MicrosoftWindows NT. Presently, there are two separate versions of the system:(1) a development version; and (2) a production version.

A development version of program 6 is used for system development, bugfixes, additions and enhancements. There is a front-end (user interface)designed with Microsoft Access 97 and a back-end (database area) is alsodesigned with Microsoft Access 97. Using Microsoft Access 97 as aback-end for development purposes enables a programmer to take fulladvantage of the flexibility offered by Microsoft Access 97 or MicrosoftAccess 2000 to make changes easily at the back-end level.

A production version of program 6 is for administration of disabilitypolicies. As above, the front-end (user interface) in designed withMicrosoft Access 97 and the back-end (database area) is designed withMicrosoft SQL Server version 7.0. Note that the front end may also bedesigned in another program such as ASP. In order to incorporate changesmade in the development version to the production version, we useMicrosoft's upsizing wizard that converts the Microsoft Access 97back-end into Microsoft SQL Server version 7.0.

Consider now the administrative process of the present invention,commencing with a User Log On Screen in FIG. 2. The user logs onto thesystem 1 by entering a USERNAME and a PASSWORD to Screen in FIG. 2. Usernames and passwords are necessary to introduce several levels ofsecurity in the system. Each level of security corresponds to a usergroup and each user belongs to a user group. Therefore each user grouphas its own level of security. One of the groups may be called <USERS>,system administrators may not want members of the USERS group to be ableto access certain screens or modify specific information. This is veryhelpful to prevent USERS from modifying data created by the members ofanother group. The user also has the option to EXIT the System 1 or tochange his/her password. The user clicks on an OK button to get to theMain Menu (Screen in FIG. 3).

The user can create a new external system, which typically is the firststep in using the System 1. In order to set up a new case, a listing ofparticipants with all pertinent underwriting and administration-relatedinformation (a census file) must be entered into the System 1 via InputDevice 12. This information can be input manually, scanned from hardcopy or imported. Most frequently the information will be importedbecause it is more convenient, faster, and far more accurate than theother methods. In order to make importing data available as often aspossible, the System 1 is designed to accept input data no matter whatsource, system, or format is being used by the census file provider.Further, the System 1 allows for the user to easily add unlimitedautomated census file formats to a list of set import alternatives.

Before importing a new census, the user needs to define an import layoutthat describes the composition of the census file so that the system cansuccessfully import the new census. From the Main Menu Screen in FIG. 3,the user clicks on the LIBRARIES command button to open up LIBRARIESScreen in FIG. 4. This Screen in FIG. 4 contains all the libraries (ordata categories) available to System 1. The user double clicks on aSYSTEM library button to open up a SYSTEM LIST Screen in FIG. 5.

The user then creates a new external system. The System 1 can interactwith an unlimited number of external systems. Within the System 1, theuser creates external systems with their own properties and conversiontables. A conversion table is a set of codes that an external systemwill use for a specific database field. For example: the user may wantto import a census from external system XYZ. The fields in the censuscan be as follows:

-   -   Social security number    -   Status.

Social security number is a universal field because a participant'ssocial security number will not vary from external system to externalsystem, whereas status is a system specific field. Each external systemwill likely use a different set of code for the status field. Thereforethe System 1 needs to know what set of codes the external system isusing so that it can convert them into its own code. Following theprevious example, the external system may use <1> for active, <2> forterminated. The System 1 needs to know these codes so that it canconvert them into its own code. The means by which the System 1 canconvert all those code is a conversion table that matches externalsystem's codes with the codes of System 1.

The use of conversion tables is critical because no external system willever be required to comply with the codes of System 1, and informationthat might be extraneous or cause system errors will automatically beremoved prior to being imported.

To add a new external system, the user clicks on a command button withthe blank page icon (Screen in FIG. 5), and a new screen (not shown inthe Figures) opens up where the user enters a name for the new externalsystem, as well as a brief description. The user clicks on an EXITcommand button (has a door with arrow icon) to add and return to theSYSTEM LIST Screen in FIG. 5 where the new external system has beenadded. The user selects the new external system and clicks on the EDITcommand button (with the magnifying glass icon) to open up the SYSTEMINFORMATION Screen in FIG. 6.

The user then needs to setup the conversion tables for the newly createdexternal system. The user clicks on a CONVERSIONS command button andopens up a CONVERSION TABLES Screen in FIG. 7. The user selects a fieldrequiring conversions on the left side of the Screen in FIG. 7 andenters the appropriate external system conversion on the right. Eachselected field comes with a separate set of items requiring conversions.For example, the field SEX requires a conversion for <male> and<female>.

Once the conversions have been entered, the user clicks the EXIT buttonto return to the SYSTEM INFORMATION Screen in FIG. 6.

The user now clicks on a FIND AND REPLACE command button to replacecertain unwanted strings in the file by other strings; for example, somewhen a date of retirement is expected for an insured but the insured hasnot retired yet, some external systems will indicate 00/00/0000 as aretirement date. By using the FIND AND REPLACE feature, the user canselect to replace all <00/00/0000> strings by spaces. An unlimitednumber of FIND AND REPLACE activities can be programmed into the System1.

The FIND AND REPLACE Screen in FIG. 8 opens up, and the user enters thestring to be searched, indicates whether he/she wants the string to besearched replaced by spaces or by a specific string. The user clicks onthe EXIT command button and returns to the SYSTEM INFORMATION Screen inFIG. 6.

The user then creates a new import layout. Import layouts are customdefinitions of the format and layout of a census file to be importedfrom an external system. Import layouts contain the footprints of thecensus file. When using import layouts, the user never has to requiredata in a specific layout from the external system. The user adds a newIMPORT LAYOUT by clicking on the command button with the blank page icon(Screen in FIG. 6), and a new screen (not shown in the figures) opens upwhere the user enters a name for the new IMPORT LAYOUT as well as abrief description. The user then clicks on the ADD button, and the newIMPORT LAYOUT is automatically added to the EXISTING LAYOUTS list box onthe SYSTEM INFORMATION Screen in FIG. 6.

The user then clicks on the EDIT command button (with the magnifyingglass icon). The LAYOUT DETAIL Screen in FIG. 9 opens up. In the FILETYPE frame, the user can choose what type of file he/she is importing.

One of the key features of the System 1 is its ability to import ASCIIdelimited files and ASCII fixed width files. Generally, the user choosesthe file format (delimited or fixed width) and then creates a layoutthat mirrors the file's layout. Instead of requiring specific layoutsfrom external systems, the System 1 is taught how to read the importfile regardless of its layout. Consider the following, example: the usermay have just received the following file and needs to import it intothe system:

John Doe 000-00-0000 11 Park Avenue New York NY 10034 4000 3A21 Al Facet999-09-0000 2 Place des Moulins Albur NJ 06789 3000 23DEAThe user will use LAYOUT DETAIL Screen in FIG. 9 or 10 to create alayout as follows:

First Name 5 Last Name 7 Social Security Number 11 Address 20 City 8State 2 Zip 5 Plan contribution 4 FILLER 6

Using the above layout, the System 1 will be able to read and import thefile perfectly without ever requiring the external system to abide byany layout rules. Note that the last field is labeled <FILLER>, whichtells the System 1 that this field is unwanted data.

Note that the user's choice of the FILE TYPE determines which LAYOUTDETAIL Screen in FIG. 9 or 10 is displayed. If the user chooses theASCII delimited FILE TYPE, the LAYOUT DETAIL Screen in FIG. 9 willdisplay two list boxes: a field list library on a left containing allpossible fields the user may import, and selected fields to import onthe right. To add a field to the selected fields list box, the userselects the field he/she wants to add from the field list library on theleft and then clicks on the ADD command button (with the arrow pointingto the right icon).

When clicking on the ADD command button, the System 1 will make surethat a field has the selected field to add has not already beenselected. Because the user has selected an ASCII delimited file, theuser will then enter a delimiter in a DELIMITER text box. The user alsoneeds to specify whether he/she wants the System 1 to skip the first Xrows when importing the file because sometime external systems includefield names at the top of an ASCII file. The System 1 will then skip thefirst row (for example) and start importing data beginning at the secondrow.

If the user chooses the ASCII fixed width FILE TYPE, the LAYOUT DETAILSScreen in FIG. 10 displays a combo box and a text box for each field tobe imported. To add a field to the selected fields list box, the userselects the field he/she wants to add from the pull down combo box, andthe user must enter the length of the field because the user hasselected a fixed width file type. As soon as a new field is selectedfrom the pull down combo box, a new pull down combo box appears rightbelow for a new field to be selected. When adding fields, the systemwill make sure that a field has the selected field to add has notalready been selected. The user also needs to specify whether he/shewants the System 1 to skip the first X rows when importing the filebecause at times external systems may include field names at the top ofan ASCII file.

Once the chosen IMPORT LAYOUT has been defined, the user clicks on anEXIT command button to return to the SYSTEM INFORMATION Screen in FIG.6. The user then clicks on the EXIT command button to return to theSYSTEM LIST Screen in FIG. 5. The user then clicks on the EXIT commandbutton to return to the LIBRARIES Screen in FIG. 4. The user then clickson the EXIT command button to return to the MAIN MENU Screen in FIG. 3.

The user can also import a new census. In order to import the census,the user clicks on the IMPORT command button located on the MAIN MENUScreen in FIG. 3. By clicking on the IMPORT command button, the usertriggers the IMPORT WIZARD process that consists of five screens thatwill help the user in the import process.

The census will contain plan participant information including but notlimited to the following fields:

-   -   Last Name    -   First Name    -   Middle Name    -   Middle Initial    -   Status (active, terminated, disabled, Leave, Death, Retirement,        Ineligible, suspended, not participating)    -   Date of Birth    -   Date of Hire    -   Date of Rehire    -   Date of Termination    -   Coverage Effective Date    -   Coverage Termination Date    -   Disability Date    -   Age    -   Sex    -   Social Security Number    -   Employee Code    -   Department Code    -   Certificate Number    -   W2 Wages    -   FICA    -   OASI    -   OASDI    -   Participant IRA Contribution    -   Participant Roth IRA Contribution    -   Participant Plan Contribution Amount    -   Participant Qualified Plus Contributions    -   Employer Plan Contribution Amount    -   Certificate Number    -   Address 1    -   Address 2    -   State    -   City    -   Zip    -   Country

If the census has already been imported but some information may havechanged (e.g., about the existing plan participants or new participantswere added), then the system 1 will update its database 20 with theinformation that has changed (archiving old information) on the existingparticipants and add the new participants to its database 20.

When importing an existing census, the system 1 performs all the abovechecks as well as monitoring very closely data that changes for theexisting insureds. The system 1 abides by the following rules whenreplacing data:

PRIVATE EXISTING DATA NEW DATA ACTION NULL NOT NULL OVERWRITE NOT NULLNULL DO NOT OVERWRITE NOT NULL NOT NULL OVERWRITE, ARCHIVE EXISTING DATAAND PRINT REPORT NULL NULL NO ACTION

Please note that censuses can also be scanned then recognized using OCR(Optical Character Recognition) and finally saved to ASCII files forimport.

The user needs to select whether he/she is importing a new census in theSystem 1 or if he/she is updating data for an existing census. Using anIMPORT WIZARD Screen in FIG. 11, the user selects <ADD A NEW CENSUS>from the IMPORT TYPES list box. The user clicks on a NEXT button.

At the IMPORT WIZARD Screen in FIG. 12, the user enters the name of thenew census for future reference. The user clicks on the NEXT button. Atthe IMPORT WIZARD Screen in FIG. 13, the user selects from the EXISTINGSYSTEM list box from which external system he/she is importing the newcensus. The user clicks on a NEXT button. At the IMPORT WIZARD Screen inFIG. 14, the user selects which IMPORT LAYOUT he/she wants to use toimport the new census. The user will select the IMPORT LAYOUT he/shejust created. The user clicks on the NEXT button. At the IMPORT WIZARDScreen in FIG. 15, the user enters the path and filename of the filecontaining the new census to be imported. The user clicks on the FINISHbutton.

The System 1 will now perform the following tasks in order tosuccessfully import the new census:

Task A—Check the file integrity. The System 1 makes sure that the numberof fields contained in the file matches the number of fields specifiedin the import layout.

Task B—The System 1 will then perform a find and replace function thatwill replace any unwanted strings (succession of characters) with a moreappropriate string. For example many external systems will print a nulldate to file (<00/00/0000>) which can create problems when importing,therefore the system finds and replaces those null dates with an equalnumber of spaces.

Task C—The System 1 then scans the file field by fields looking forpotential errors including but not limited to alphanumerical characterswhen numbers are expected and vice versa, wrong social security number,wrong state codes or data required that is not provided. In this case, alist of all errors will be printed to the screen containing an errormessage, the row number where the error occurred and the field name.

Task D—The System 1 imports data located on the file into its database.A message box will appear saying “THE CENSUS HAS BEEN IMPORTEDSUCCESSFULLY”. The user clicks on the OK command button and returns tothe MAIN MENU Screen in FIG. 3.

Please note that the census can also be entered by hand, as discussedbelow.

In any case, the user also can calculate ages for the newly importedcensus. Ages may be imported within the census file. If this is not thecase then the user can calculate ages internally on an age nearestbirthday basis or age last birthday basis.

The user clicks on a LIBRARIES command button and opens up the LIBRARIESScreen in FIG. 4. The user double clicks on the CENSUS Library andbrings up the CENSUS LIST Screen in FIG. 16. Next, the user doubleclicks on the new census he/she just imported to open up the CENSUS EDITScreen in FIG. 17. In an AGE CALCULATION METHOD frame, the user selectswhich age calculation method he/she wants to use. The user can choosefrom AGE NEAREST BIRTHDAY or AGE LAST BIRTHDAY. The user then clicks onINSUREDS to access the INSURED LIST Screen in FIG. 18.

In order to calculate ages, the user needs to click on the CALCULATEAGES command button to open up the AGE CALC Screen in FIG. 18. The userenter the date as of which he/she elects to calculate ages and thenclicks on the CALCULATE command button. The System 1 then check eachinsured's date of birth for its existence and validity.

The System 1 executes the following process to calculate ages as of lastbirthday:

Sub ALBCALC(Bday As Long, BMonth As Long, BYear As Long, pDay As Long,pMonth As Long, pYear As Long, ALB_AGE As Long) Dim D1 As Long Dim E1 AsLong D1 = pMonth − BMonth If D1 > 0 Then  E1 = 0 End If If D1 < 0 Then E1 = −1 End If If D1 = 0 Then  If pDay >= Bday Then   E1 = 0  Else   E1= −1  End If Else  E1 = −1 End If ALB_AGE = pYear − BYear + E1 End Sub

The System 1 executes the following process to calculate ages as ofnearest birthday:

Sub ANBCALC(Bday As Long, BMonth As Long, BYear As Long, pDay As Long,pMonth As Long, pYear As Long, ANB_AGE As Long) Dim D1 As Long Dim E1 AsLong D1 = pMonth − BMonth If D1 > 5 Then  If D1 = 6 Then   If Bday >=pDay Then    E1 = 0   Else    E1 = 1   End If  Else   E1 = 1  End IfElse  If D1 < −5 Then   If D1 = −6 Then    If Bday >= pDay Then     E1 =−1    Else     E1 = 0    End If   Else    E1 = −1   End If  Else   E1 =0  End If End If ANB_AGE = pYear − BYear + E1 End Sub

A message box then pops up informing the user that all ages werecalculated successfully. The user clicks on OK and returns to theINSURED LIST Screen in FIG. 18. The AGE column on the INSURED LISTScreen in FIG. 18 is updated with the new ages.

The user exits the INSURED LIST Screen in FIG. 18 by clicking on theEXIT command button and returns to the CENSUS EDIT Screen in FIG. 17.The user exits the CENSUS EDIT Screen in FIG. 17 by clicking on the EXITcommand button and returns to the CENSUS LIST Screen in FIG. 16. Theuser exits the CENSUS LIST Screen in FIG. 16 by clicking on the EXITcommand button and returns to the LIBRARIES Screen in FIG. 4.

The user can also create a new sponsor (e.g., the company that employsthe insured, the mutual fund company offering the IRA, an other IRAprovider, the Social Security Administration). The System 1 needs totrack all sponsors for reporting and communication purposes. It ispossible that a single sponsor may set up multiple plans based upondifferent participation criteria. For example, highly compensatedemployees of an employer sponsor may be provided a separate plan fromrank and file employees. The employer or other sponsor may want policypricing to be based on the combined experience of all employees undermultiple plans. The system must be capable of tracking each planseparately yet combine them for various purposes. Carriers, insurers orreinsurers (carriers) may also want to customize reports based upondifferent combinations of plans or sponsors. The system must be capableof quickly generating customized reports, exporting and extracting them,and automatically delivering them to all interested and pre-authorizedparties.

The user double clicks on the SPONSOR LIBRARY at Screen in FIG. 4 toopen up the SPONSOR LIST Screen in Figure (not provided in the figures,but it is similar to the CENSUS LIST Screen in FIG. 16). The user adds anew SPONSOR by clicking on the command button with the blank page icon,and a new SPONSOR EDIT Screen in Figure (not shown in figures) opens upwhere the user enters a name for the new SPONSOR as well as a briefdescription. The user then clicks on ADD button, and the new SPONSOR isautomatically added to the EXISTING SPONSORS list box on the SPONSORLIST Screen in Figure. The user double clicks on the newly createdSPONSOR to open up the SPONSOR EDIT Screen in FIG. 20. The user can nowenter address, city, state, ZIP, country, and a logo for the SPONSOR. Byclicking on a CONTACTS button (opened booklet icon), the user can entercontact information for the specific sponsor (this process will bedescribed later in this document with CARRIER information).

The user exits the SPONSOR EDIT Screen in Figure by clicking on the EXITcommand button and returns to the SPONSOR LIST screen. The user exitsthe SPONSOR LIST screen by clicking on the EXIT command button andreturns to the LIBRARIES Screen in FIG. 4.

The user can also create a new carrier or selects an existing carrier.The carrier is either the insurance company (primary carrier or primaryinsurer) that insures the insured or the reinsurer who shares risk withthe primary carrier or, in the case of self insured plans, shares riskwith the plan sponsor. The System 1 needs to also track the carriers forreporting and communication purposes. The user double clicks on theCARRIER LIBRARY to open up the CARRIER LIST Screen in Figure (notprovided, but similar to the CENSUS LIST screen).

The user adds a new CARRIER by clicking on a command button with theblank page icon, and a new screen opens up where the user enters a namefor the new CARRIER as well as a brief description. The user then clickson ADD button and the new CARRIER is automatically added to the EXISTINGCARRIERS list box on the CARRIER LIST screen. The user double clicks onthe newly created SPONSOR to open up the CARRIER EDIT Screen in FIG. 21.The user can now enter address, city, state, ZIP, country, and a logofor the CARRIER. By clicking on the CONTACTS button (opened bookleticon), the user opens up the CONTACT LIST Screen in FIG. 22. The usermay add a new contact by clicking on the command button with the blankpage icon, and a new screen opens up where the user enters a name and atitle. The user then clicks on ADD button, and the new CONTACT isautomatically added to the EXISTING CONTACT list box on the CONTACT LISTScreen in FIG. 22. The user edits the new CONTACT by double clicking thenew contact's name in the CONTACT list box. The CONTACT EDIT Screen inFIG. 23. The user may enter the following information for each contact:

-   -   Last Name    -   First Name    -   Position    -   Address    -   City    -   State    -   Zip    -   Country    -   Phone Number    -   Fax Number    -   Portable Number    -   E Mail

The user exits the CONTACT EDIT Screen in FIG. 23 by clicking on theEXIT command button and returns to the CONTACT LIST Screen 22. The userexits the CONTACT LIST screen by clicking on the EXIT command button andreturns to the CARRIER EDIT Screen in FIG. 21.

The user exits the CARRIER EDIT Screen in FIG. 21 by clicking on theEXIT command button and returns to the CARRIER LIST Screen in FIG. 21.The user exits the CARRIER LIST Screen in FIG. 21 by clicking on theEXIT command button and returns to the LIBRARIES Screen in FIG. 4.

The user can also create a new record keeper or select an existingrecord keeper. The record keeper administers the retirement plancontaining individual accounts (e.g., IRAs, plans qualified under IRCSections 401(a), 403(b), and 457, and Social Security, if adopted withindividual accounts). It keeps track of plan participants'contributions, account balances, and status. The system needs to trackrecord keepers for report and communication purposes. The user doubleclicks on the RECORD KEEPER library to open up the RECORD KEEPER LISTScreen in Figure (not provided, but similar to the CENSUS LIST Screen inFIG. 16.

The user adds a new RECORD KEEPER by clicking on the command button withthe blank page icon, and a new screen opens up where the user enters aname for the new RECORD KEEPER as well as a brief description. The userthen click on ADD button, and the new RECORD KEEPER is automaticallyadded to the EXISTING RECORD KEEPERS list box on the RECORD KEEPER LISTscreen. The user double clicks on the newly created RECORD KEEPER toopen up the RECORD KEEPER EDIT Screen in FIG. 24. The user can now enteraddress, city, state, ZIP, country, and a logo for the RECORD KEEPER. Byclicking on the CONTACTS button (opened booklet icon), the user opens upthe CONTACT LIST Screen in FIG. 24. The user may add a new contact byclicking on the command button with the blank page icon, and a newscreen opens up where the user enters a name and a title. The user thenclick on ADD button, and the new CONTACT is automatically added to theEXISTING CONTACT list box on the CONTACT LIST Screen in FIG. 22. Theuser edits the new CONTACT by double clicking the new contact's name inthe CONTACT list box. The CONTACT EDIT Screen in FIG. 23 opens up.

The user exits the CONTACT EDIT Screen in FIG. 23 by clicking on theEXIT command button and returns to the CONTACT LIST Screen in FIG. 22.The user exits the CONTACT LIST Screen in FIG. 22 by clicking on theEXIT command button and returns to the RECORD KEEPER EDIT Screen in FIG.24.

The user exits the RECORD KEEPER EDIT Screen in FIG. 24 by clicking onthe EXIT command button and returns to the RECORD KEEPER LIST Screen inFigure. The user exits the RECORD KEEPER LIST Screen in Figure byclicking on the EXIT command button and returns to the LIBRARIES Screenin FIG. 3. The user exits the LIBRARIES screen by clicking on the EXITcommand button and returns to the MAIN MENU Screen in FIG. 3.

The user can also create a new plan or selects an existing plan. Theuser clicks on the PLANS command button to open up the PLAN LIST Screenin FIG. 25. A list of all the plans contained into the System 1 isdisplayed. The user adds a new PLAN by clicking on the command buttonwith the blank page icon, and PLAN ADD Screen in FIG. 26 opens up wherethe user enters information about the new plan.

The information about the new plan includes, but is not limited to:

-   -   Plan name    -   Plan Type    -   Plan description    -   Plan carrier (the user would select the newly created carrier)    -   Plan carrier 2 (user would select if a reinsurer was being used)    -   Plan sponsor (the user would select the newly created sponsor)    -   Plan census (the user would select the newly imported census)    -   Plan 2 census (the user would select if the sponsor was insuring        common participants of two or more plans)    -   Plan record keeper (the user would select the newly created        record keeper)    -   Coverage of employee contribution: what percentage of the        employee contribution do you want to        insure (if applicable)?    -   Coverage of employer contribution: what percentage of the        employer contribution do you want to        insure (if applicable)?    -   Coverage of IRA participant: what percentage of the IRA        participant contribution do you want to        insure (if applicable)?    -   Coverage by IRA provider: what percentage of the IRA participant        contribution do you want to        insure (if applicable)?    -   Coverage of participant of individual social security account:        what percentage of the participant's FICA do you want to        insure (if applicable)?    -   Does the plan pay benefits at time of disability?    -   Does the plan pay benefits at early retirement?    -   Does the plan pay benefits at normal retirement?    -   Does the plan pay benefits at death?    -   Does the plan pay a lump sum benefit?    -   Does the plan allow for refund of premium?

In the event that an employee terminates employment, the plan may or maynot refund the unearned portion of the premium for the balance of theplan year. If no refund is provided, then a paid up policy, or someother consideration may be provided.

The premium calculation method will specify how premiums are calculated;there are two options: (1) the user either enters a premium rate thatwill be the same for all insureds regardless of age and sex; (2) theuser selects TABLE RATE, and a pull down combo box appears with a listof available premium tables by age and sex (for an example of premiumtable please see Screen in FIG. 27.

The user can then enter a plan issue date.

The user can then click on the ADD button, and the new PLAN isautomatically added to the PLAN LIST list box on the PLAN LIST Screen inFIG. 25. The user double clicks on the newly created PLAN to open up thePLAN EDIT Screen in FIG. 28.

The PLAN EDIT screen contains 4 tabs. A first tab is the general tab,which contains all standard information about the plan including name,description, carrier, sponsor, census, record keeper, plan issue dateand plan code. The second tab is the plan design tab (Screen in FIG.29), which contains all plan design information including whether theplan allows for refunds of premium, the percentage of coverage ofemployee and employer contribution, whether benefits are payable at thetime of disability or deferred until retirement, early retirement ordeath, the method for determining the growth of deferred benefits, thepremium calculation method, the applicable method for establishingreserves for reported claims and for claims that are incurred but notreported, whether benefits are payable to the plan or directly toparticipants and beneficiaries, etc. The third tab is the administrationfees tab (Screen in FIG. 30), which contains formulas to gross up thepremium by an amount equal to the administration fee. This tab can alsobe used for creating commissions, marketing fees, or other fees.

As to this third tab, there are 3 possible formulas to create anadministration and/or other fees: (1) charge a percent of premium feewhere the administration fee is calculated as a percentage of premium;(2) charge a flat dollar amount; and (3) charge a per 1000 of coveragefee where the administration fee is calculated as a dollar amount foreach $1,000 dollar of coverage.

The fourth tab is the calculations tab (Screen in FIG. 31), whichprovides four types of computing. The first type of computing is forupdating the coverage and benefit payouts for all insureds. The userclicks on the UPDATE command button, and the System 1 calculatescoverage and benefit payout amounts for all insureds. The System 1 loopsthrough each insured and multiplies the coverage or benefit payout bythe participant contribution percentage or other by the applicable typeof contribution and stores the result in the participant coverage amountfield. While looping through each insured, the System 1 also multipliesthe coverage of employer or sponsor contribution by a percentage andstores the result in the employer or sponsor coverage amount field.

The second type of computing is for calculating the disability premiums.To calculate the disability premiums, the user clicks on the CALCULATEcommand button in the DISABILITY PREMIUMS frame. The System 1 willcalculate two base premiums based on the newly calculated participantand employer or sponsor coverage amount. The System 1 takes the rateprovided in the plan design tab (Screen in FIG. 29) and multiplies it bythe coverage amount for both the participant coverage amount andemployer or sponsor coverage amount. Once the base premiums arecalculated the System 1 calculates the administration fee based on thechosen method of calculating the administration fee in theadministration fee tab (Screen in FIG. 30) and adds the fee to the basepremium to store the final disability premium for both the participantcoverage amount and the employer coverage amount.

The third type of computing is for calculating unearned or unusedpremiums. To calculate unearned premiums for all insureds, the userclicks on the CALCULATE button in the UNEARNED PREMIUMS frame. TheSystem 1 will calculate the number of days between the last plananniversary date and divide that number by 365 to obtain the unearnedratio. The unearned ratio is multiplied by (the participant annualpremium plus the employer annual premium) to obtain the participantunearned premium and the employer unearned premium.

The fourth type of computing is for calculating reserves. There are twotypes of reserves that are calculated. The first type of reserve is forclaims that are incurred, but not reported. This is a reserve that is anestimate, generally based on the carriers previous experience, of thenumber of claims that have occurred, but have not yet been reported. Thesecond kind of reserve is for claims that have been reported. Thisreserve can be further broken down into two broad category types.Reserves for reported claims for coverage with benefit payments made atthe time of disability, and secondly, reserves for reported claims forcoverage with benefit payments deferred until retirement, earlyretirement or death. Reserves for reported claims for coverage withbenefit payments made at the time of disability are intended torepresent the net present value of future benefits likely to be paidduring the entire length of the disability (consequently, reserves startout high and generally diminish as payments are made). Two reserves mustgenerally be established for reported claims for coverage with benefitpayments deferred to retirement, early retirement or death represent.The first reserve is identical to that of coverage payable at the timeof disability. The second must track the actual deferred benefits thathave accrued on behalf of the participant to date.

Now that the user has calculated the coverage amounts, the disabilitypremium amounts and the unearned premium amounts, and can calculatereserves, the user exits the PLAN EDIT Screen in FIG. 31 by clicking onthe EXIT command button and returns to the PLAN LIST Screen in FIG. 25.The user exits the PLAN LIST screen by clicking on the EXIT commandbutton and returns to the MAIN MENU Screen in FIG. 3.

The user next verifies newly calculated information for all insureds.Once premiums have been calculated, the user can check the premiums byprinting reports or by editing insured's information. From the MAIN MENUScreen in FIG. 7, the user clicks on the LIBRARIES command button toopen up the LIBRARIES Screen in FIG. 4. The user double clicks on theCENSUS Library and brings up the CENSUS LIST Screen in FIG. 16.

The user double clicks on the census that belongs to the plan he/shejust created to open up the CENSUS EDIT Screen in FIG. 17. The userclicks on INSUREDS to access the INSURED LIST Screen in FIG. 18. To adda new insured by hand, the user clicks on the command button with theblank page icon, and a new screen opens up where the user enters a namefor the new insured. The user then click on ADD button, and the newinsured is automatically added to the INSURED list box on the INSUREDLIST Screen in FIG. 19.

The user double clicks on any insured to open up the INSURED EDIT Screenin FIG. 32 and edits information about the selected insured. The INSUREDEDIT Screen in FIG. 32 has 5 tabs:

The first tab is the GENERAL tab (Screen in FIG. 32), which containsstandard information about the insured including but not limited to lastname, first name, social security number, employee code, departmentcode, age, sex, certificate number, and status.

The second tab is the DATES tab (Screen in FIG. 33) contains allrelevant dates to the status field of the insured. These dates includebut are not limited to date of birth, date of hire, date of rehire, dateof termination, coverage effective date, coverage termination date anddisability date.

The third tab is the ADDRESS tab (Screen in FIG. 34), which containsaddress information including but not limited to street address, city,state, and ZIP.

The fourth tab is the PREMIUM tab (Screen in FIG. 35), which containsthe original participant and employer or sponsor contribution, theparticipant and employer or sponsor coverage amounts just calculated andreflecting the plan design coverage ratios, and the participant andemployer premium amounts that were just calculated.

The fifth tab is the UNEARNED PREMIUM tab (Screen in FIG. 36), whichcontains the participant unearned premium amount, the employer orsponsor unearned premium amount, and the date as of which the unearnedpremium was calculated. The user can calculate unearned premiums for aspecific insured by clicking on the CALCULATE UNEARNED PREMIUM commandbutton.

The user exits the INSURED EDIT Screen in FIG. 32 by clicking on theEXIT command button and returns to the INSURED LIST Screen in FIG. 18.The user exits the INSURED LIST screen by clicking on the EXIT commandbutton and returns to the CENSUS EDIT Screen in FIG. 17. The user exitsthe CENSUS EDIT screen by clicking on the EXIT command button andreturns to the CENSUS LIST Screen in FIG. 16. The user exits the CENSUSLIST Screen in Figure by clicking on the EXIT command button and returnsto the LIBRARIES Screen in FIG. 4. The user exits the LIBRARIES screenby clicking on the EXIT command button and returns to the MAIN MENUScreen in FIG. 3.

The user can then prepare reports and print reports or create printfiles. The System 1 can print custom designed reports for recordkeepers, carriers, and plan sponsors. The user clicks on the REPORTScommand button to open up the REPORT Screen in FIG. 37. The user selectsthe report he/she wants to print in the SELECT REPORT list box and thenselects which plan he/she wants the report based on in the PLAN pulldown combo box. The user clicks on the REPORT command button (with areport icon), and the report is automatically sent to the Screen in FIG.38. The user can then print to the printer, fax, or print the report tofile to be e-mailed. The user exits the REPORT screen by clicking on theEXIT command button and returns to the MAIN MENU Screen in FIG. 3.

Additionally, the user can export data to external systems. This is oneof the most critical features of the System 1. The System 1 can exportdata from its database to external systems. By creating custom exports,data can be very easily extracted from the System 1 and fed to externalsystems and report designers. The user has total control over thecreation of the import: the user can export data in multiple availablefile formats, control the layout of the export (sequence of fields) andquery the database for what data to extract.

The insured clicks on the EXPORT command button to open up the EXPORTLIST Screen in FIG. 39. All exports are listed on this screen. The useradds a new EXPORT by clicking on the command button with the blank pageicon, and the ADD EXPORT Screen in FIG. 40 opens up. The user enters thefollowing information to create a new export:

-   -   Export name    -   Export description    -   The name of the external system to which this export is        directed.

The reason why the user has to specify the name of the external systemis because of the conversion tables. For example the user may want toexport the field SEX to an external system that only understands <0> formales and <1> for females. The System 1 is designed to make thatconversion automatically on behalf of the external system.

The export type, which can be of the following types:

-   -   ASCII delimited    -   ASCII fixed width    -   EXCEL 3.0    -   EXCEL 4.0    -   EXCEL 5.0    -   EXCEL 7.0    -   EXCEL 97    -   EXCEL 98    -   EXCEL 2000    -   LOTUS files

The user then clicks on the ADD button and the new EXPORT isautomatically added to EXPORT LIST list box on the EXPORT LIST Screen inFIG. 39. The user double clicks on the newly created EXPORT to open upthe EXPORT EDIT Screen in FIG. 41.

The EXPORT EDIT screen contains 4 tabs, the first of which is theGeneral tab (shown in Screen in FIG. 41) that contains the export name,the export description, the name of the external system to export to,the filename used to save the export, and the option to save the fieldnames at the top of the export file.

The second of the tabs is the Layout tab (Screen in FIG. 42) that allowsthe user to select which fields he/she would like to export and in whatorder. The user simply selects a field from the field library list boxon the left and adds it by clicking on the ADD command button (buttonwith arrow pointing towards right) to the list box on the right thatcontains the selected fields for export. To remove a field from theselected list box on the right, the user selects the field he/she wantsto remove and clicks on the REMOVE command button (button with arrowpointing towards left). The user can virtually export any fields fromthe insured table in any sequence.

The third tab is the File Format tab (Screen in FIG. 43), which containsa list of available file formats to save the export file. Please referto the above list.

The fourth tab is the Data to Export tab (Screen in FIG. 44), whichcontains the necessary variables to query the database as it relates tothe data being exported. The user can select any combination of PLANS,CARRIERS, RECORD KEEPERS and SPONSORS.

The user exits the EXPORT EDIT Screen in FIG. 44 by clicking on the EXITcommand button and returns to the MAIN MENU Screen in FIG. 3.

The user can then create an export schedule. Export schedules automatethe task of E-mailing exports on a regular basis to record keepercontacts, carrier contacts, and sponsor contacts. This is extremelyuseful because it does not require human intervention and deliverselectronically custom design exports to client over such diverse networkstructures as the internet or a local server accessible on-line by theclient.

Now that the user has created a new export, he/she can E-mail thatEXPORT to specific recipients on a regular basis. The user clicks on theLIBRARIES command button and opens up the LIBRARIES Screen in FIG. 4.The user double clicks on the EXPORT SCHEDULE library and brings up theEXPORT SCHEDULE LIST Screen in FIG. 45. The user adds a new EXPORTSCHEDULE by clicking on the command button with the blank page icon, andthe SCHEDULE ADD Screen in FIG. 46 opens up. The user enters thefollowing information:

-   -   Export schedule name    -   Export schedule description    -   Export name (name of the newly created EXPORT the user wants to        create a SCHEDULE for)    -   Frequency (daily, weekly, monthly, quarterly, semi-annually and        annually)    -   Export starting date.

The user then clicks on the ADD button, and the new EXPORT SCHEDULE isautomatically added to EXPORT SCHEDULE LIST list box on the EXPORTSCHEDULE LIST Screen in FIG. 45. The user double clicks on the newlycreated EXPORT SCHEDULE to open up the EXPORT SCHEDULE EDIT Screen inFIG. 47. The EXPORT SCHEDULE EDIT screen contains 4 tabs:

The first tab is the General tab contains general information about theEXPORT SCHEDULE: the schedule name, the schedule description, theEXPORT, the frequency, the schedule starting date, the option tocompress the file before sending, and an optional password to protectthe compressed file.

The second tab is the Record Keeper Recipients tab (Screen in FIG. 48),which allows the user to select among all record keeper contactscontained in the System 1 those to whom the file should be sent viaE-mail to. The user selects from the upper list box a record keepercontact he/she would like to E-mail the export file to and clicks on theADD command button (hand pointing down icon) to add the selectedrecipient to the SELECTED RECIPIENTS list box. The user can remove aselected record keeper recipient by selecting the recipient in theSELECTED RECIPIENT list box and clicking on the REMOVE command button(hand pointing up icon).

The third tab is the Carrier Recipients tab (essentially the same asScreen in FIG. 4), which allows the user to select among all carriercontacts contained in the system those to whom the file should beE-mailed to. The user selects from the upper list box a carrier contacthe/she would like to E-mail the export file to and clicks on the ADDcommand button (hand pointing down icon) to add the selected recipientto the SELECTED RECIPIENTS list box. The user can remove a selectedcarrier recipient by selecting the recipient in the SELECTED RECIPIENTlist box and clicking on the REMOVE command button (hand pointing upicon).

The fourth tab is the Sponsor Recipients tab (essentially the same asScreen in FIG. 50), which allows the user to select among all sponsorcontacts contained in the system those to whom the file should beE-mailed to. The user selects from the upper list box a sponsor contacthe/she would like to E-mail the export file to and clicks on the ADDcommand button (hand pointing down icon) to add the selected recipientto the SELECTED RECIPIENTS list box. The user can remove a sponsorrecipient by selecting the recipient in the SELECTED RECIPIENT list boxand clicking on the REMOVE command button (hand pointing up icon).

The user exits the EXPORT SCHEDULE EDIT Screen in FIG. 44 by clicking onthe EXIT command button and returns to the EXPORT SCHEDULE LIST Screenin FIG. 45. The user exits the EXPORT SCHEDULE LIST Screen in FIG. 45 byclicking on the EXIT command button and returns to LIBRARIES Screen inFIG. 4. The user exits the LIBRARIES Screen in FIG. 4 by clicking on theEXIT command button and returns to the MAIN MENU Screen in FIG. 3.

The user can then select what back-end type to use in the options ofSystem 1. The user clicks on the OPTIONS command button and opens up theSYSTEM OPTIONS Screen in FIG. 49. In the ATTACHMENT METHOD frame, theuser can select the type of back-end he/she wants to use. He/she canchoose from Microsoft Access 97 (or latest version) and Microsoft SQLServer 6.5 (or latest version). Then the user clicks on the ATTACHcommand button, and the system will connect to the proper back-endlocally or on the network.

The user exits the SYSTEM OPTIONS Screen in FIG. 49 by clicking on theEXIT command button and returns to the MAIN MENU Screen in FIG. 3.

How to make the apparatus of FIG. 1 to carry out the method illustratedin FIGS. 2-49 is generally shown in FIG. 50 and more particularlydisclosed in the copy of the computer program 6 code provided as anappendix hereto.

FIG. 50 commences at Block 54, wherein the computer 2 receives inputdata, such as the census data discussed above, including a list ofinsureds. The data can be received directly from any input device 12 orindirectly, e.g., via a diskette or E-mail; in either case, though,information is entered into some input device which converts theinformation into input digital electrical signals representing the inputinformation for communication by the first digital electrical computer4. The digital electrical signals can be formatted into ASCII fixed orASCII delimited files. Preferably, the input digital electrical signalsare received in a data file with known data structures from a secondcomputer 19 of a record keeper, sponsor, carrier, etc.

At Block 54, the computer 4 checks the integrity of the data file toensure that the data structures are consistent with an import layoutpredefined for recognition by computer 4.

At Block 56, computer 4 performs the above-described “find and replace”activities by reading specific data strings in the input data inaccordance with the import layout, finding those strings that the userdirects computer 4 to discard, and replacing those strings with otherstrings of data defined by the user.

At Block 60, computer 4 checks the input data in each field to ensurethat the input data in accordance with the import layout. For example,if the computer 4 is expecting a STATE CODE data structure in atwo-digit character code, the Computer will verify that the input dataelements correspond to a state.

At Block 62, computer 4 completes the task of reading (i.e., importing)the input data, and writes a file containing the input data to thedatabase 20.

At Block 58, logic is provided to specify the file format, datastructures, and layout definitions for importing the input data, logicutilized in reading the imported data as discussed above.

At Block 64, logic is provided for calculating the ages of the insureds.

At Block 66, logic is provided for selecting a method for calculatingthe ages of the insureds, e.g., nearest birthday or age at the lastbirthday.

At Block 68, logic is provided for determining coverage amount andbenefit payouts based on a portion of the contribution.

At Block 66, logic is provided for reading the plan design to enabledetermining coverage amount and benefit payouts based on a portion ofthe contribution and the selected plan design.

At Block 72, logic is provided for calculating premium amount.

At Block 66, logic is provided for reading premium rates from a tablefor a respective carrier's policy to enable calculating the premiumamount.

At Block 75, logic IS provided for computing reserves. This logic iscarried out by referencing the plan design and other variables (at Block66), premium amounts (at Block 72), and updated census reports.

At Block 76, logic is provided for computing an unearned premium amount.This logic is carried out by determining the number of days remaining tothe next plan anniversary date, the number then being divided by thenumber of days in the year, with the remainder then multiplied by thepremium to obtain the amount of unearned premium.

At Block 78, computer 4 directs an output of an illustration, report,fax, documentation, or the like—produced optionally in hard copy orelectronic media for E-mail to the computer 18 or 19 of the recordkeeper, carrier, reinsurer, sponsor, participant, mutual fund provider,other IRA provider, Social Security Administration, or an entityperforming administration on behalf of the Social SecurityAdministration.

At Block 80, computer 4 directs creation of a customizable digital dataextract based on the user-defined layouts (at Block 58) created forexporting output data from computer 4 to the external systems.

In sum, the present invention is quite robust. Thus, the scope of theinvention should be determined by the appended claims and their legalequivalents, rather than by the principal embodiment and other examplesdescribed above.

1. A method of computing to update a machine-readable database andproduce digital output, the method comprising: an input device, anoutput device, and a digital electrical computer including a processor,the computer operably associated with the input device and with outputdevice, the computer programmed to form processor circuitry whichreceives machine-readable input data via the input device, stores themachine-readable input data in a memory, stores in memorymachine-readable output data produced by processing the input data,retrieves from the memory the machine-readable output data that isproduced, and outputs the machine-readable output data that is producedvia the output device, wherein the computer system is configured toperform the steps of: receiving, at a computer system comprising aninput device, an output device, and a digital electrical computerincluding a processor, the computer operably associated with the inputdevice and with output device, the computer programmed to form processorcircuitry which receives machine-readable input data via the inputdevice, stores the machine-readable input data in a memory, stores inmemory machine-readable output data produced by processing the inputdata, retrieves from the memory the machine-readable output data that isproduced, and outputs the machine-readable output data that is producedvia the output device, the input data, comprising input plancontribution data for a retirement plan having respective accounts forindividuals; storing as said machine-readable data, the plancontribution data in a database of said memory; processing by thedigital electrical computer, said input data the plan contribution datain processing digitally computing an amount of consideration attendantto offering coverage or protection for a benefit associated with atleast one of said accounts according to said retirement plan; updatingthe database in the memory to include the digitally computed amount ofthe consideration; and outputting the output data at the output deviceso that the output includes the amount of consideration for the coverageor the protection.
 2. The method of claim 1, wherein the retirement planis a social security retirement plan.
 3. The method of claim 1, whereinthe retirement plan is an IRA.
 4. The method of claim 1, wherein theretirement plan is a ROTH IRA.
 5. The method of claim 1, wherein theretirement plan is an employer sponsored retirement plan in which theemployer is not a state government, a local government, a church, or anon-profit organization.
 6. The method of claim 1, wherein theretirement plan is an employer-sponsored retirement plan in which theemployer is a state government, a local government, a church, or anon-profit organization.
 7. The method of claim 1, wherein the computingincludes computing for at least two of said individual accounts for aparticipant in at least two said retirement plans.
 8. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection commencing at an earliest of retirement, earlyretirement, and death of a participant, and wherein the retirement planis a social security retirement plan.
 9. The method of claim 1, whereinthe computing includes computing for the coverage or the protectioncommencing at an earliest of retirement, early retirement, and death ofa participant, and wherein the retirement plan is an IRA.
 10. The methodof claim 1, wherein the computing includes computing for the coverage orthe protection commencing at an earliest of retirement, earlyretirement, and death of a participant, and wherein the retirement planis a ROTH IRA.
 11. The method of claim 1, wherein the computing includescomputing for the coverage or the protection commencing at an earliestof retirement, early retirement, and death of a participant, and whereinthe retirement plan is an employer sponsored retirement plan in whichthe employer is not a state government, a local government, a church, ora non-profit organization.
 12. The method of claim 1, wherein thecomputing includes computing for the coverage or the protectioncommencing at an earliest of retirement, early retirement, and death ofa participant, and wherein the t retirement plan is anemployer-sponsored retirement plan in which the employer is a stategovernment, a local government, a church, or a non-profit organization.13. The method of claim 1, wherein the computing includes computing forthe coverage or the protection commencing at an earliest of retirement,early retirement, and death of a participant such that at least two ofsaid individual accounts are for a participant in at least two saidretirement plans which are employer sponsored plans.
 14. The method ofclaim 1, wherein the receiving input plan contribution data includesreceiving input FICA data.
 15. The method of claim 1, wherein thereceiving input plan contribution data includes receiving input FederalOld Age, Survivors, and Disability Insurance data.
 16. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection commencing at retirement of a participant, and whereinthe retirement plan is a social security retirement plan.
 17. The methodof claim 1, wherein the computing includes computing for the coverage orthe protection commencing at retirement of a participant, and whereinthe retirement plan is an IRA.
 18. The method of claim 1, wherein thecomputing includes computing for the coverage or the protectioncommencing at retirement of a participant, and wherein the retirementplan is a ROTH IRA.
 19. The method of claim 1, wherein the computingincludes computing for the coverage or the protection commencing atretirement of a participant, and wherein the retirement plan is anemployer sponsored retirement plan in which the employer is not a stategovernment, a local government, a church, or a non-profit organization.20. The method of claim 1, wherein the computing includes computing forthe coverage or the protection commencing at retirement of aparticipant, and wherein the retirement plan is an employer-sponsoredretirement plan in which the employer is a state government, a localgovernment, a church, or a non-profit organization.
 21. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection commencing at retirement of a participant such that atleast two of said individual accounts are for a participant in at leasttwo retirement plans which are employer sponsored plans.
 22. The methodof claim 1, wherein the computing includes computing for the coverage orthe protection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is a social securityretirement plan.
 23. The method of claim 1, wherein the computingincludes computing for the coverage or the protection commencing at anearlier of retirement and death of a participant, and wherein theretirement plan is an IRA.
 24. The method of claim 1, wherein thecomputing includes computing for the coverage or the protectioncommencing at an earlier of retirement and death of a participant, andwherein the retirement plan is a ROTH IRA.
 25. The method of claim 1,wherein the computing includes computing for the coverage or theprotection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is an employer sponsoredretirement plan in which the employer is not a state government, a localgovernment, a church, or a non-profit organization.
 26. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is an employer sponsoredretirement plan in which the employer is a state government, a localgovernment, a church, or a non-profit organization.
 27. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection commencing at an earlier of retirement and death of aparticipant such that at least two of said individual accounts are for asingle participant in at least two said retirement plans which areemployer sponsored plans.
 28. The method of claim 1, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at retirement of a participant, and wherein the retirementplan is a social security retirement plan.
 29. The method of claim 1,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at retirement of a participant, andwherein the retirement plan is an IRA.
 30. The method of claim 1,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thebenefit commences at retirement of a participant, and wherein theretirement plan is a ROTH IRA.
 31. The method of claim 1, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at retirement of a participant, and wherein the retirementplan is an employer sponsored retirement plan in which the employer isnot a state government, a local government, a church, or a non-profitorganization.
 32. The method of claim 1, wherein the computing includescomputing for the coverage or the protection, wherein a portion of thecoverage or the protection commences immediately after an applicableelimination period has been satisfied during a time of disability,wherein a separate portion of the coverage or the protection commencesat retirement of a participant, and wherein the retirement plan is anemployer sponsored retirement plan in which the employer is a stategovernment, a local government, a church, or a non-profit organization.33. The method of claim 1, wherein the computing includes computing forthe coverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, and wherein a separateportion of the coverage or the protection commences at retirement of aparticipant such that at least two of said individual accounts are for asingle participant in at least two said retirement plans which areemployer sponsored plans.
 34. The method of claim 1, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earlier of retirement and death of a participant, andwherein the retirement plan is a social security retirement plan. 35.The method of claim 1, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earlier ofretirement and death of a participant, and wherein the for retirementplan is an IRA.
 36. The method of claim 1, wherein the computingincludes computing for the coverage or the protection, wherein a portionof the coverage or the protection commences immediately after anapplicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earlier of retirement and death of a participant, andwherein the retirement plan is a ROTH IRA.
 37. The method of claim 1,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at an earlier of retirement anddeath of a participant, and wherein the retirement plan is an employersponsored retirement plan in which the employer is not a stategovernment, a local government, a church, or a non-profit organization.38. The method of claim 1, wherein the computing includes computing forthe coverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earlier ofretirement and death of a participant, and wherein the retirement planis an employer-sponsored retirement plan in which the employer is astate government, a local government, a church, or a non-profitorganization.
 39. The method of claim 1, wherein the computing includescomputing for the coverage or the protection, wherein a portion of thecoverage or the protection commences immediately after an applicableelimination period has been satisfied during a time of disability, andwherein a separate portion of the coverage or the protection commencesat an earlier of retirement and death of a participant such that atleast two of said individual accounts are for a single participant in atleast two said retirement plans which are employer sponsored plans. 40.The method of claim 1, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is a social security retirement plan.
 41. The methodof claim 1, wherein the computing includes computing for the coverage orthe protection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at an earliest of retirement, earlyretirement, and death of a participant, and wherein the retirement planis an IRA.
 42. The method of claim 1, wherein the computing includescomputing for the coverage or the protection, wherein a portion of thecoverage or the protection commences immediately after an applicableelimination period has been satisfied during a time of disability,wherein a separate portion of the coverage or the protection commencesat an earliest of retirement, early retirement, and death of aparticipant, and wherein the retirement plan is a ROTH IRA.
 43. Themethod of claim 1, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is an employer sponsored retirement plan in whichthe employer is not a state government, a local government, a church, ora non-profit organization.
 44. The method of claim 1, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earliest of retirement, early retirement, and death of aparticipant, and wherein the retirement plan is an employer-sponsoredretirement plan in which the employer is a state government, a localgovernment, a church, or a non-profit organization.
 45. The method ofclaim 1, wherein the computing includes computing for the coverage orthe protection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, and wherein a separate portion ofthe coverage or the protection commences at an earliest of retirement,early retirement, and death of a participant such that at least two ofsaid individual accounts are for a single participant in at least twosaid retirement plans which are employer sponsored plans.
 46. The methodof claim 1, wherein the computing includes computing for the coverage orthe protection structured as a group long term disability insurancepolicy.
 47. The method of claim 1, wherein the computing includescomputing for the coverage or the protection structured as an individuallong term disability insurance policy.
 48. The method of claim 1,wherein the computing includes computing for the coverage or theprotection structured as a waiver of premium of a life insurance policy.49. The method of claim 1, wherein the computing includes computing forthe coverage or the protection structured as a waiver of premium of aflexible premium deferred annuity.
 50. The method of claim 1, whereinthe computing includes computing for the coverage or the protectionstructured as a contractual arrangement modifying terms of a depositarrangement to a mutual fund.
 51. The method of claim 1, wherein thecomputing includes computing a consideration to be paid by a primaryinsurance company to at least one reinsurance company in exchange forthe at least one reinsurance company assuming a specified portion ofrisk undertaken by the primary insurance company for insuring thecoverage or the protection.
 52. The method of claim 1, wherein thecomputing includes computing for the coverage or the protectionstructured as a health insurance policy commencing at an earliest ofretirement and early retirement.
 53. The method of claim 1, wherein thecomputing includes computing for the coverage or the protectionstructured as a long-term care insurance policy commencing at anearliest of retirement and early retirement.
 54. A digital processingmachine, the machine comprising: an input device, an output device, anda digital electrical computer including a processor, the computeroperably associated with the input device and with output device, thecomputer programmed to form processor circuitry which receivesmachine-readable input data via the input device, stores themachine-readable input data in a memory, stores in and retrieves fromthe memory machine-readable output data produced by processing the inputdata, and outputs the machine-readable output data that is produced viathe output device, wherein the computer system is configured to: receiveas the input data plan contribution data for a retirement plan havingrespective accounts for individuals; store as the input data such thatthe plan contribution data is stored in a database of said memory;process the plan contribution data produce the output data, including,digitally computing an amount of consideration attendant to offeringcoverage or protection for a benefit associated with at least one ofsaid accounts according to said retirement plan; stores and retrievesthe output data in the memory so as to include the computed amount ofthe consideration; and outputs the output data at the output device soas to include the amount of consideration for the coverage or theprotection.
 55. The machine of claim 54, wherein the retirement plan isa social security retirement plan.
 56. The machine of claim 54, whereinthe retirement plan is an IRA.
 57. The machine of claim 54, wherein theretirement plan is a ROTH IRA.
 58. The machine of claim 54, wherein theretirement plan is an employer sponsored retirement plan in which theemployer is not a state government, a local government, a church, or anon-profit organization.
 59. The machine of claim 54, wherein theretirement plan is an employer-sponsored retirement plan in which theemployer is a state government, a local government, a church, or anon-profit organization.
 60. The machine of claim 54, wherein thecomputing includes computing for at least two of said individualaccounts for a participant in at least two said retirement plans. 61.The machine of claim 54, wherein the computing includes computing forthe coverage or the protection commencing at an earliest of retirement,early retirement, and death of a participant, and wherein the retirementplan is a social security retirement plan.
 62. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection commencing at an earliest of retirement, early retirement,and death of a participant, and wherein the retirement plan is an IRA.63. The machine of claim 54, wherein the computing includes computingfor the coverage or the protection commencing at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is a ROTH IRA.
 64. The machine of claim 54, whereinthe computing includes computing for the coverage or the protectioncommencing at an earliest of retirement, early retirement, and death ofa participant, and wherein the retirement plan is an employer sponsoredretirement plan in which the employer is not a state government, a localgovernment, a church, or a non-profit organization.
 65. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection commencing at an earliest of retirement, earlyretirement, and death of a participant, and wherein the retirement planis an employer-sponsored retirement plan in which the employer is astate government, a local government, a church, or a non-profitorganization.
 66. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection commencing at anearliest of retirement, early retirement, and death of a participantsuch that at least two of said individual accounts are for a participantin at least two said retirement plans which are employer sponsoredplans.
 67. The machine of claim 54, wherein the receiving input plancontribution data includes receiving input FICA data.
 68. The machine ofclaim 54, wherein the receiving input plan contribution data includesreceiving input Federal Old Age, Survivors, and Disability Insurancedata.
 69. The machine of claim 54, wherein the computing includescomputing for the coverage or the protection commencing at retirement ofa participant, and wherein the retirement plan is a social securityretirement plan.
 70. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection commencing atretirement of a participant, and wherein the retirement plan is an IRA.71. The machine of claim 54, wherein the computing includes computingfor the coverage or the protection commencing at retirement of aparticipant, and wherein the retirement plan is a ROTH IRA.
 72. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection commencing at retirement of a participant,and wherein the retirement plan is an employer sponsored retirement planin which the employer is not a state government, a local government, achurch, or a non-profit organization.
 73. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection commencing at retirement of a participant, and wherein theretirement plan is an employer-sponsored retirement plan in which theemployer is a state government, a local government, a church, or anon-profit organization.
 74. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protectioncommencing at retirement of a participant such that at least two of saidindividual accounts are for a participant in at least two retirementplans which are employer sponsored plans.
 75. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is a social securityretirement plan.
 76. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection commencing at anearlier of retirement and death of a participant, and wherein theretirement plan is an IRA.
 77. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protectioncommencing at an earlier of retirement and death of a participant, andwherein the retirement plan is a ROTH IRA.
 78. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is an employer sponsoredretirement plan in which the employer is not a state government, a localgovernment, a church, or a non-profit organization.
 79. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection commencing at an earlier of retirement and death of aparticipant, and wherein the retirement plan is an employer sponsoredretirement plan in which the employer is a state government, a localgovernment, a church, or a non-profit organization.
 80. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection commencing at an earlier of retirement and death of aparticipant such that at least two of said individual accounts are for asingle participant in at least two said retirement plans which areemployer sponsored plans.
 81. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at retirement of a participant, and wherein the retirementplan is a social security retirement plan.
 82. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at retirement of a participant, andwherein the retirement plan is an IRA.
 83. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thebenefit commences at retirement of a participant, and wherein theretirement plan is a ROTH IRA.
 84. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at retirement of a participant, and wherein the retirementplan is an employer sponsored retirement plan in which the employer isnot a state government, a local government, a church, or a non-profitorganization.
 85. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection, wherein a portionof the coverage or the protection commences immediately after anapplicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at retirement of a participant, and wherein the retirementplan is an employer sponsored retirement plan in which the employer is astate government, a local government, a church, or a non-profitorganization.
 86. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection, wherein a portionof the coverage or the protection commences immediately after anapplicable elimination period has been satisfied during a time ofdisability, and wherein a separate portion of the coverage or theprotection commences at retirement of a participant such that at leasttwo of said individual accounts are for a single participant in at leasttwo said retirement plans which are employer sponsored plans.
 87. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earlier ofretirement and death of a participant, and wherein the retirement planis a social security retirement plan.
 88. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at an earlier of retirement anddeath of a participant, and wherein the for retirement plan is an IRA.89. The machine of claim 54, wherein the computing includes computingfor the coverage or the protection, wherein a portion of the coverage orthe protection commences immediately after an applicable eliminationperiod has been satisfied during a time of disability, wherein aseparate portion of the coverage or the protection commences at anearlier of retirement and death of a participant, and wherein theretirement plan is a ROTH IRA.
 90. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earlier of retirement and death of a participant, andwherein the retirement plan is an employer sponsored retirement plan inwhich the employer is not a state government, a local government, achurch, or a non-profit organization.
 91. The machine of claim 54,wherein the computing includes computing for the coverage or theprotection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, wherein a separate portion of thecoverage or the protection commences at an earlier of retirement anddeath of a participant, and wherein the retirement plan is anemployer-sponsored retirement plan in which the employer is a stategovernment, a local government, a church, or a non-profit organization.92. The machine of claim 54, wherein the computing includes computingfor the coverage or the protection, wherein a portion of the coverage orthe protection commences immediately after an applicable eliminationperiod has been satisfied during a time of disability, and wherein aseparate portion of the coverage or the protection commences at anearlier of retirement and death of a participant such that at least twoof said individual accounts are for a single participant in at least twosaid retirement plans which are employer sponsored plans.
 93. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is a social security retirement plan.
 94. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is an IRA.
 95. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earliest of retirement, early retirement, and death of aparticipant, and wherein the retirement plan is a ROTH IRA.
 96. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection, wherein a portion of the coverage or theprotection commences immediately after an applicable elimination periodhas been satisfied during a time of disability, wherein a separateportion of the coverage or the protection commences at an earliest ofretirement, early retirement, and death of a participant, and whereinthe retirement plan is an employer sponsored retirement plan in whichthe employer is not a state government, a local government, a church, ora non-profit organization.
 97. The machine of claim 54, wherein thecomputing includes computing for the coverage or the protection, whereina portion of the coverage or the protection commences immediately afteran applicable elimination period has been satisfied during a time ofdisability, wherein a separate portion of the coverage or the protectioncommences at an earliest of retirement, early retirement, and death of aparticipant, and wherein the retirement plan is an employer-sponsoredretirement plan in which the employer is a state government, a localgovernment, a church, or a non-profit organization.
 98. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection, wherein a portion of the coverage or the protectioncommences immediately after an applicable elimination period has beensatisfied during a time of disability, and wherein a separate portion ofthe coverage or the protection commences at an earliest of retirement,early retirement, and death of a participant such that at least two ofsaid individual accounts are for a single participant in at least twosaid retirement plans which are employer sponsored plans.
 99. Themachine of claim 54, wherein the computing includes computing for thecoverage or the protection structured as a group long term disabilityinsurance policy.
 100. The machine of claim 54, wherein the computingincludes computing for the coverage or the protection structured as anindividual long term disability insurance policy.
 101. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection structured as a waiver of premium of a life insurancepolicy.
 102. The machine of claim 54, wherein the computing includescomputing for the coverage or the protection structured as a waiver ofpremium of a flexible premium deferred annuity.
 103. The machine ofclaim 54, wherein the computing includes computing for the coverage orthe protection structured as a contractual arrangement modifying termsof a deposit arrangement to a mutual fund.
 104. The machine of claim 54,wherein the computing includes computing a consideration to be paid by aprimary insurance company to at least one reinsurance company inexchange for the at least one reinsurance company assuming a specifiedportion of risk undertaken by the primary insurance company for insuringthe coverage or the protection.
 105. The machine of claim 54, whereinthe computing includes computing for the coverage or the protectionstructured as a health insurance policy commencing at an earliest ofretirement and early retirement.
 106. The machine of claim 54, whereinthe computing includes computing for the coverage or the protectionstructured as a long-term care insurance policy commencing at anearliest of retirement and early retirement.